According to a recent survey conducted by Saga magazine, over 3 million 20 – 34 year olds in the UK still live at home. A staggering statistic given that it’s likely if you’re within this age bracket and are reading this story, your own parents will have been able to move out of home when they were your age. However, could David Cameron’s Help to Buy scheme offer any assistance to us first time buyers?
The £12 billion Help to Buy scheme is hoped to help young people get their first step up on the old property ladder. With the prospect of saving thousands of pounds often a desperate struggle, the government plans to help by guaranteeing 15% of the loan. The plan will ultimately allow people with 5% of the deposit to buy a house worth £600,000 or less. Sounds pretty good, doesn’t it?
Maybe not as good as it initially sounds, as loans are set to become more expensive and the scheme itself only planned to assist 25,000 buyers in the next three years – not exactly covering those 3 million people still living with their parents. The banks involved in the scheme include the RBS, Natwest and Halifax, with a few more joining in the next few months.
…Help to Buy is going to make the dream of home ownership a reality…
According to the Prime Minister, “Thousands of people will be able to get a foot on the housing ladder by applying for the new Help to Buy mortgage guarantee. If you’ve got 5 per cent of the funds for a mortgage deposit, we’re providing a guarantee to the banks to help you get the rest. Help to Buy is going to make the dream of home ownership a reality for many who would otherwise have been shut out. This goes right to the heart of my vision for Britain – a country where everyone who works hard can get on in life. Moves such as Help to Buy will also encourage house building. If potential buyers can’t buy, builders won’t build – so this is an important part of unlocking the market.”
According to the rules of Help to Buy, the scheme does not include buying your second home, so it really is for those people looking to make the first move into owning their own home. Many, however, are worried that the scheme may cause a bubble in the housing market.
…the first stage of the scheme was rolled out earlier in the year…
Keep in mind, Help to Buy isn’t a new thing, as the first stage of the scheme was rolled out earlier in the year – with good results, according to the government. Although it’s a small glimmer of hope for those of us looking to escape our living with mum and dad, it could still be a while before you make it to the front of the queue and finally get the keys to your first home.