News story

Help to Buy: helping first-time buyers onto the housing ladder

This news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Official statistics show more than 48,000 people have bought a home through the scheme.

Since the launch of the two parts of Help to Buy, the equity loan and mortgage guarantee schemes:

  • 82% of scheme completions have been made by first-time buyers
  • the average house price was £187,800, significantly below the national average
  • more than 48,000 people have bought a home through the scheme
  • 94% of Help to Buy completions took place outside of London
  • postcode level data shows that the top ten hotspots are spread across the country

Postcode-level data shows just how Help to Buy schemes are helping families and hardworking people across the country to achieve their dream of homeownership.

Communities, builders and businesses can use the information to see exactly how the scheme is benefitting their area.

The top ten Help to Buy hotspots are:

  • Bedford (MK42) – 215 sales
  • Chorley (PR7) – 209 sales
  • Kingston Upon Hull (HU7) – 209 sales
  • Gloucester (GL2) – 205 sales
  • Colchester (CO2) – 174 sales
  • South Gloucestershire (BS34) – 172 sales
  • Ashfield (NG17) – 165 sales
  • Peterborough (PE2) – 163 sales
  • Northampton (NN5) – 154 sales
  • Wiltshire (BA14) – 154 sales

Today’s Help to Buy official statistics show that the government’s scheme is successfully targeting the people that need it most, having helped almost 40,000 first-time buyers onto the housing ladder since the scheme launched last year.

Out of a total of 48,393 Help to Buy completions to date, 82% have been made by first-time buyers.

This demonstrates that while Help to Buy continues to account for only a small percentage of overall mortgage transactions (2.5% for mortgage guarantee), the scheme successfully targets those who need a helping hand to get on the housing ladder.

Help to Buy also continues to support responsible lending: the average house price for both parts of the scheme, at £187,800 (£153,148 for the mortgage guarantee and £209,390 for the equity loan scheme), remains significantly below the national average house price of £265,000.

The Chancellor has been clear that responsible lending is a core aspect of Help to Buy. On 26 June he announced that new mortgage guarantee loans would be restricted to 4.5 times borrowers’ income, in line with the introduction of a loan-to-income limit on mortgage lending by the Bank of England.

This introduced a further safeguard to ensure that the mortgage guarantee scheme continues to support responsible lending.

Help to buy infographic showing the number of first time buyers

Continuing the trends that started to emerge in previous Help to Buy figures, today’s official statistics show that the scheme is benefiting every region of the country.

While Help to Buy completions have been least concentrated in areas where house price growth has been highest, the highest number of mortgage guarantee scheme completions has been in the North West, and the highest number of equity loan scheme sales has been in the South East.

Overall, 94% of the total 48,393 completions under the scheme have been made by households outside of London.

The equity loan scheme in particular is also helping to drive an increase in the number of homes that are being built in the UK.

At the same time the construction sector has been growing for 15 consecutive months, and is currently experiencing the sharpest rise in house building orders since 2003, while companies are taking on new workers at the fastest rate since 1997.

Access the data on Help to Buy: equity loan scheme.

Today’s statistics follow recent positive indications about the UK housing market.

Mortgage approvals grew by 14% in the year to June, with total property transactions growing by the same amount. Last year successful applications for major housing schemes were up by 23%, and planning permissions were granted for 216,000 new homes.

New housing starts have begun to respond, growing by 20% in the year to Q2 2014.

The Chancellor said:

Help to Buy is working exactly as we intended. It’s helping first time buyers onto the housing ladder.

It’s a key part of our long term economic plan, which is supporting hard working people to secure a better future for their families.

Importantly, Help to Buy is also driving a big increase in house building in Britain, boosting the construction industry and increasing housing supply

Chief Secretary to the Treasury, Danny Alexander, said:

I am delighted that over 48,000 people have already been helped onto or up the housing ladder as a result of the Help to Buy scheme.

Today’s figures show that the government is delivering on its commitment to make home ownership a reality for as many households across the country as possible.

On a visit to Bedford, Communities Secretary Eric Pickles said:

The 2008 housing crash devastated our housing industry, locking thousands of aspiring homeowners out of the market for years, and leading to the loss of a quarter of a million construction jobs.

The government’s long-term economic plan, including Help to Buy, has turned that around, leading developers to build more homes and creating thousands of jobs across the country, and around 50,000 households to buy with a fraction of the deposit they would normally require – over 80 per cent of which are first-time buyers.

House builders have also welcomed the role Help to Buy has played in boosting supply. Home Builders Federation Executive Chairman Stewart Baseley said:

The Help to Buy equity loan scheme is helping thousands of people buy their own home every month.

This increase in demand is allowing builders to significantly increase the number of new homes being built – homes that the country desperately needs.

To enable it to increase housing building rates, the industry is recruiting thousands of apprentices and new employees and boosting supply chains and local economies the length and breadth of the country.

Help to Buy headline figures

Scheme Mortgage guarantee Equity loan Help to Buy combined Total transactions
Number of completions 18,564 29,829 48,393 731,500
Average (mean) value of property £153,148 £209,390 £187,815 £265,000
Percentage of first time buyers 79% 85% 82% 31%
Percentage outside London and the South East 81% 77% 79% 64%
Borrower income (median) £42,482 n/a n/a £43,000

Help to Buy regional breakdown: total equity loan and mortgage guarantee completions

Region Mortgage guarantee completions Equity loan completions Help to Buy completions
South-East 2,505 4,996 7501
East 1,865 4,103 5968
South-West 1,486 3,785 5271
North-West 2,513 3,667 6180
West Midlands 1,603 3,272 4875
East Midlands 1,586 3,264 4850
Yorkshire and the Humber 1,712 3,010 4722
London 965 1,872 2837
North-East 851 1,860 2711
Scotland* 2,298 - 2298
Wales* 899 - 899
Northern Ireland* 276 - 276
Total UK 18,559** 29,829 48,388**

*Mortgage guarantee only

**Regional total differs from UK total due to completions with unrecognised postcodes or allocated to Channel Islands or Isle of Man

Top ten local authorities for Help to Buy

Local Authority Mortgage guarantee completions Equity loan completions Help to Buy completions
Leeds 260 503 763
Wiltshire UA 126 528 654
Birmingham 241 348 589
Central Bedfordshire UA 108 453 561
County Durham UA 143 346 489
Milton Keynes UA 75 406 481
Peterborough UA 60 417 477
Bradford 116 347 463
Manchester 100 326 426
Liverpool 124 279 403

Morgage guarantee regional breakdown

Region Number of completions Average scheme property value Average regional value*
South East 2,505 £206,889 £326,000
East 1,865 £181,434 £274,000
South West 1,486 £168,521 £241,000
North West 2,513 £125,784 £171,000
West Midlands 1,603 £140,407 £194,000
Yorkshire and the Humber 1,712 £124,073 £173,000
London 965 £284,151 £499,000
North East 851 £114,230 £150,000
Scotland 2,298 £116,767 £193,000
Wales 899 £116,268 £167,000
Northern Ireland 276 £100,519 £137,000

*ONS house price index June 2014

Regional percentage of Help to Buy: Mortgage guarantee lending

Region All regulated mortgage lending per region* Mortgage guarantee per region Mortgage guarantee as % of regional lending
South East 22.9% 13.5% 1.5%
East 4.1% 10.0% 6.2%
South-West 9.0% 8.0% 2.3%
North-West 9.2% 13.5% 3.8%
West Midlands 7.7% 8.6% 2.9%
East Midlands 7.3% 8.5% 3.0%
Yorkshire and the Humber 7.8% 9.2% 3.0%
London 13.5% 5.2% 1.0%
North-East 4.2% 4.6% 2.8%
Scotland 8.5% 12.4% 3.7%
Wales 4.1% 4.8% 3.0%
Northern Ireland 1.7% 1.5% 2.2%
Total UK: 100% 100% 2.5%

*CML data for Q4 2013 and Q2 2014

Mortgage guarantee data is for the period October 2013 to June 2014. Equity loan data is for the period April 2013 to Jult 2014.