HTB could be scrapped amid fears it's helping the wealthy

Graham_Devon

Of course, it won't be scrapped, but having looked at the data, ministers fear that the scheme is helping wealthier people upgrade their homes and helping to push house prices further from the reach of those the scheme is intended to support. Many of us here told them that when it was introduced. Case of NS sherlock here.

The government’s Help to Buy scheme could be ditched amid fears it is pushing up house prices and helping wealthy people upgrade their homes.

Ministers are reportedly planning a “fundamental review” of the policy, which was introduced by David Cameron in 2013 in a bid to help people onto the housing ladder.

An option being considered by ministers is a temporary, restricted version of the scheme, which would avoid the disruption that would be brought about by terminating the scheme with just three years’ notice for developers.

Earlier this year, official government data revealed the average household income of people benefiting from the £8.3bn scheme is continuing to rise, and now stands at just under £50,000.

In London, the figure is even higher, with the average recipient of a Help to Buy loan having a household income of almost £72,000.

Builders are stating that should anything change, the government will not be able to meet it's housing targets.

Of course, they haven't met them anyway.

Meanwhile, the average price of a new build house has increased by £50,000 since the scheme was launched. Or 20%. Housebuilder profits per unit sold have increased by around 25-45% over the same period.



https://www.independent.co.uk/news/uk/politics/help-to-buy-housing-scheme-wealthy-household-government-cut-conservative-a8519516.html

Pennywise

Basic economics. Supply & demand. Increase availability of funds and prices will rise. Simples.

Graham_Devon

Pennywise wrote: »

Basic economics. Supply & demand. Increase availability of funds and prices will rise. Simples.

Seems the entire industry wish to deny this.

PasturesNew

Easy, if I'm a builder with a house for sale and nobody can afford more than £200k that's the price I have to sell at... trying it on at first at £220k, then dropping.

Toss in H2B and now I can stick them on at £250k!

jonnygee2

Builders are stating that should anything change, the government will not be able to meet it's housing targets.

If I sold cakes for £1, and the government had a policy that gave everyone in the country 40p so long as they bought one of my cakes for £1, I would very much want that policy to continue too.

Everyone apart from the builders seems to think its a bad idea. RICS said it should be scrapped or regionalised. The IMF said it would make houses more unaffordable. The Institute of Directors called it 'very dangerous'. OBR said it will inflate prices and be dangerous. It's fairly rare to see the various economic think-tanks so united on an issue.

On the other hand, Taylor Wimpey and Persimmon think it's a great idea that will help loads of people get on the housing ladder and create more homes for the UK.

Cakeguts

It doesn't matter if wealthier people upgrade their homes if they sell the one that they currently have. The people getting wealthier from HTB are the builders.

mayonnaise

And then there's the other side of the coin.

More than 420,000 people get on the housing ladder with Help to Buy

https://www.gov.uk/government/news/more-than-420000-people-get-on-the-housing-ladder-with-help-to-buy

mrginge

Erm. ‘Average household income of just under £50k’

That’s not wealthy.

Malthusian

It is compared to the median household income of £27k. And "wealthy" is always relative and never an absolute, so in this context, that means it is.

Scheme to help people buy houses helps people who are well off enough to buy houses. Astonishing.

In other news, scheme to help people buy rosaries disproportionately benefits Catholics.

HPC_Ghuol_Hunter

You seem to have a real beef with helping others buy their own homes. Why? Do they not deserve what you have buddy? Why do you wish to denegrate them to a rent forever loser status?

Graham_Devon

Galiford Try have stated today that profits have increased 145% on last year backed by Help to Buy and a cut in stamp duty.

Housing completions have risen just 13%, with average selling prices up 11%, but the firm state that should the government wish to see a further increase in housing, schemes like HTB must be continued.

Meanwhile, new figures out suggest that help to buy purchases cost 8% more than buying the very same house without HTB.

It's all gone a little insane.