Government Help to Buy Scheme won’t Help Existing Home Owners
House builders will benefit
The newly announced help to buy scheme is designed to assist new first time buyers to get their foot on the property ladder. At the same time it is designed to give house builders the opportunity to expand quickly. So these are the winners but who really looses out in this equation?
The Government realise there is a housing shortage
In the Government budget last week George Osborne announced that he will inject a £130bn into the lending system to directly assist the lenders who are participating in this scheme. Effectively this money is being used as an interest free loan with the government paying 20% of your deposit direct to the bank and the home owner adds the further 5%. In fact a winning situation has been created and the government are able to provide interest free terms as they realise that they will make a substantial amount of money from the increase in value from their 20% equity stakes. This initially appears to be a smart move by the UK government as they are appearing to help but are also investing £130bn of the country’s money into the property market. The other very important issue that has been addressed is a looming housing shortage crisis and new properties have to be built to keep up with the growing population. There is already shortage of homes so the race is on, if however too many homes are built then that may limit price increases.
Will this help you to sell your house fast?
For those who are currently trying to sell their house this new announcement provides no benefit at all. Unfortunately as an existing home owner this new plan may divert traffic away from your door. Particularly for lower value homes the first time buyer market equates for a large amount of buyers. It is difficult to predict how successful this scheme will be and it is currently limited only to the amount for new build houses that can be built in a given space of time. For first time buyers the opportunity to own a desirable new build home and only have to put down a 5% deposit is a very attractive offer and a far easier option then having to find a far larger sum of money. With buyers having more access to available properties it could have a knock on effect and stiffen future price growth for your house, with more supply comes more competition from those who need to sell fast. For many sellers across the country the market may be improving and you may be receiving more viewings due to better mortgage terms in general. Some of the most favourable mortgage deals that we have seen for years are now available and the banks are starting to change their conservative attitude.
“YouSellQuick gave me a very good deal and helped me through the whole process.”
“I got exactly what they offered in my bank account, nothing less, no extra fees or commissions.”
We can buy your house right now, please contact us
We can give you a preliminary offer over the phone
Final offer is subject to independent RICS valuation