Why prop up the new build market instead of the ENTIRE property market??

mailmannz

Maybe Im missing something here (or maybe Im just being a grumpy old !!!!!!) but it really does get on me t1ts how the Government has structured help to buy so that it ONLY ever benefits new build companies instead of either people buying or current owners looking to sell a house!

We've been looking at new builds and it seems that you can only get help to buy on certain lots depending on how long the property has been sitting waiting for a buying. The other thing help to buy seems to do is to keep new build property prices inflated! Instead of a developer cutting the price of a house to get it moved all they are doing is making it available on help to buy at the same price so they dont miss out but you do (because its not reduced to encourage a sale).

Also limiting help to buy to new builds is absolute crap! The help to buy scheme SHOULD be completely transparent to everyone but the people looking to buy a house. They should be allowed to use the scheme to buy where they want instead of being locked in to new builds that developers cant shift!

Anyway, we are fortunate in not needing help to buy but the scheme, as its designed, doesnt seem to be there for the benefit of buyers and home sellers but for the benefit of property developers.

Meh...sorry for the grumble...just must be that time of month!  

cattie

New builds provide work for those in the constuction trade, so it's a boost to the construction industry limiting the HTB scheme to this type of property only. There'd be an awful lot of trades people out of work if there were no newbuilds for them to work on.

moneysavinghero

It's designed to increase the supply of housing. Who increases the supply of housing? Housebuilders do. If you make it more profitable for housebuilders to build and sell homes then they are going to build more homes. If you provide incentives to buy old grumpy mailmannz house, then yes that is great for mailmannz and he may be less grumpy when he checks his bank balance but it not going to increase the housing supply.

Mickey666

That may well be what it was designed to do but in practice it has mostly channelled millions of taxpayers money into increased profits and bonuses for the likes of Persimmon.
https://www.leaseholdknowledge.com/help-to-buy-cheat-persimmon-racks-up-1bn-profits-and-spread-the-plague-of-leasehold-houses-around-the-country/

moneysavinghero

Mickey666 said:

That may well be what it was designed to do but in practice it has mostly channelled millions of taxpayers money into increased profits and bonuses for the likes of Persimmon.
https://www.leaseholdknowledge.com/help-to-buy-cheat-persimmon-racks-up-1bn-profits-and-spread-the-plague-of-leasehold-houses-around-the-country/

As i said it's designed to increase housebuilding by making it more profitable to build houses. As a Persimmon shareholder who has made a sh** load of money since the Brexit vote from holding Persimmon shares, i am fully aware of how profitable house building is currently.

Mickey666

Also, the inflated prices of new builds caused by the HTB scheme doesn't benefit buyers, in the short term at least:
https://www.which.co.uk/news/2020/06/exclusive-one-in-seven-help-to-buy-homes-lose-value-despite-local-house-prices-soaring/

davidmcn

The initial rationale was to make it worthwhile for developers to actually bother building on the sites they bought based on pre-2008 forecasts of where property values were going to be - otherwise they might still be sitting on them now.

MovingForwards

I assume OP isn't trying to buy in Scotland as they could look up first home fund and the lift scheme.

Mickey666

davidmcn said:

The initial rationale was to make it worthwhile for developers to actually bother building on the sites they bought based on pre-2008 forecasts of where property values were going to be - otherwise they might still be sitting on them now.

Well it certainly made it worthwhile for the likes of Persimmon - profits per house up by around 300% and £75m bonus for the CEO, albeit reduced from £110m after a bit of a public hoo-hah,  Still, nice money if you can get it - ker-ching!

amandacat

My daughter bought a new build on HTB as it was the only way she could get on the property ladder but this means due to the inflated price she won’t be able to move for several years without being in negative equity. 
The room sizes are also ridiculously small, the lounge is tiny and you have to walk through the lounge to get to the kitchen and the toilet. 
There were also several snags what needed sorting including the front garden flooding every time it rained which still hasn’t been sorted. 
On the plus it has a nice new bathroom, kitchen, boiler and very efficient heating. 

RelievedSheff

amandacat said:

My daughter bought a new build on HTB as it was the only way she could get on the property ladder but this means due to the inflated price she won’t be able to move for several years without being in negative equity. 
The room sizes are also ridiculously small, the lounge is tiny and you have to walk through the lounge to get to the kitchen and the toilet. 
There were also several snags what needed sorting including the front garden flooding every time it rained which still hasn’t been sorted. 
On the plus it has a nice new bathroom, kitchen, boiler and very efficient heating. 

Presumably your daughter was aware of the room sizes and house layout prior to buying the house?

We moved into a new build 18 months ago. We considered using help to buy to get a bigger property but instead decided to part exchange our old house against a more modest 3 bed detached. Even so the rooms are a decent size and we have a proper hallway. 

You pay your money and take your choice.