The current situation with Help to Buy
The Help to Buy scheme was made available in April 2013. It was named as the flagship housing policy of the coalition administration, led by the then Prime Minister David Cameron along with former Chancellor George Osborne.
When the scheme was set up, it was due to expire in April 2021., with a new version of the scheme (for first-time buyers only) that will run from April 2021 to March 2023. Under this plan, sales transactions would need to have been agreed by December 2020 in order to take advantage of the scheme.
What does this mean for buyers?
To ease pressure on house builders, the government’s Help to Buy building deadline has been pushed back by two months to help thousands of families move into their new homes, despite interruptions in building these new homes because of the pandemic.
The government says the deadline for the homes to be completed in order to comply with the equity loan scheme has been extended to ‘ensure customers do not miss out if there has been a delay in construction due to the pandemic’.
Rather than the building of the new homes needing to be finished by the end of December (as was the original plan), the extension means the deadline will now move to 28 February 2021, ‘helping thousands of customers to get the keys to their new home.
However, the deadline for the legal completion of the sale will remain the same – namely March 31 2021. That said, the government has put in place an extra measure for those existing customers who have experienced severe delays as a consequence of Covid-19.
Homes England, the non-departmental public body that is charged with funding new affordable housing in England, will work with those who had a reservation in place before 30th June to examine their situation and look to provide an extension where necessary. If this is needed, they will have until 31st May 2021 to legally complete.
In its announcement, the government also confirmed that the new Help to Buy scheme, which will replace the current scheme, will still come into place from 1 April 2021 and run until March 2023 as planned. There are no proposals for further extensions.
The new scheme is restricted to first-time buyers only, in order to dispel the criticism from some that Help to Buy has been helping more buyers further up the ladder than was perhaps intended. Property price caps will be implemented as the objective becomes to support people into their first home.
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