Property experts have welcomed news that the first phase of the Help to Buy scheme has helped more than 5,000 people buy properties, the vast majority first-time buyers.
The Help to Buy equity loan scheme funded 5,375 property purchases in six months, with first-time buyers accounting for 92% of total purchases, according to new government data.
The average property price under the scheme was £194,167, bought with an average equity loan of £38,703.
Andy Frankish, new homes director at Mortgage Advice Bureau, said the number of first-time buyers was encouraging.
"Today’s figures suggest the scheme is effectively oiling the wheels of the new-build market and improving access to property without encouraging buyers to overstretch their budgets and take on commitments beyond their means."
He also welcomed the news that a significant proportion of new homes reservations have come outside London. "The scheme is clearly working across the length and breadth of England.
“The fact that a developer like Taylor Wimpey has already sold 30% of the houses it plans to build next year should spur developers and take the supply of housing to the next level."
Richard Sexton, director of e.surv chartered surveyors, said Help to Buy has given the housing market a vital shot to the arm. "We’ve seen a staggering leap in lending for first-time buyers.
"Our latest mortgage monitor showed high-LTV lending is 80% higher than October last year, and this is only the beginning as first-time buyers sprint back to the marketplace."
But he warned the property market could suffer a New Year hangover as the initial surge of buyers fades and media attention dwindles. "The Mortgage Market Review could further put the brakes on, as lenders become more cautious. The severe shortage of housing threatens to force prices out of reach if it isn't addressed imminently.
"While we already have Help to Buy, what we really need now is a Help to Build scheme, and this should be a government priority moving into 2014.”
Buyers are already struggling to get a foothold in London, said Peter Rollings, chief executive of Marsh & Parsons. "The number of purchases between £500,000 and £600,000 using the Help to Buy equity loan scheme accounts for only 26 completed property sales throughout the UK in the last six months, from a total of nearly 5,500."
But he praised Help to Buy for sparking a chain reaction that will be felt at all rungs of the property ladder. "The market is brimming with confidence and fluidity has returned. The second phase of Help to Buy will only increase this further.”
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