Nearly half of all Londoners could apply for the government’s help-to-buy scheme in the next 12 months, research suggests.
Despite the impact of COVID-19 on the economy, a massive nine in 10 (92%) Londoners are planning to purchase a property in the next year, with 61% of these saying the pandemic has had either a positive effect or no effect on their finances, YouGov data shows.
With nearly half (49%) of London property-seekers being first-time buyers, many will be eligible for the government’s help-to-buy scheme, which was recently extended to 2023.
Through the scheme, first-time buyers in London could borrow up to 40% of the cost of their new home — twice what those outside the capital can borrow — as long as the purchase price is below £600,000 and they have minimum 5% deposit.
However, some London areas are more desirable — and affordable — than others, research by money.co.uk found.
Barnet is the most desirable area for help-to-buy purchases, with 1,835 homes bought through the scheme — despite homes in Barnet being more expensive than almost two thirds (61%) of other London boroughs, the data shows.
Barnet is followed by Tower Hamlets (1,708), Croydon (1,584), Greenwich (1,551) and Lewisham (1,200).
Unsurprisingly, the most expensive London areas have had fewer help-to-buy transactions, with the City of London seeing the least homes bought through the scheme — just five.
Kensington and Chelsea (16) and Westminster (45) have also seen very few help-to-buy purchases, the data shows.
YouGov data also shows three quarters (83%) of prospective buyers — those who said they plan to purchase a property in the next 12 months — have yet to actually apply for a mortgage.
Of those who have applied, 44% told money.co.uk a reduced number of available mortgage products made the process considerably harder.
“Since the UK went into lockdown in March, we have seen a huge impact on the property sector as a whole,” said Salman Haqqi, personal finance expert at money.co.uk.
“However, following the recent reopening of the market, there has been an increase in the number of people purchasing the properties they had to put on hold due to COVID-19 restrictions.”
“For those looking to buy, there are currently fewer mortgage products available than pre-COVID-19, but there are still some good deals to be found. With the base rate at a historical low at the moment, prospective buyers should really do their homework and research their options.
“If they have any doubts, they should speak to a mortgage advisor to ensure they are getting the right deal for their personal affordability, and circumstance.”