Editor's note: This brief was summarised by The Property AI Newsroom from a report by PropertyWire. Read the original article for full details.
Chancellor Confirms No Revival of Help to Buy Scheme
Chancellor Rachel Reeves has confirmed that the Government will not revive the Help to Buy scheme, citing defence spending as a higher priority than new property market incentives. Reeves made the announcement at a conference organised by investment bank Peel Hunt, stating that increased defence spending would prevent new commitments in other areas.
According to the Daily Telegraph, Reeves said that prioritising defence means the Government cannot make commitments everywhere, as this could lead to over-commitment and under-delivery, as well as high interest rates. The Chancellor also suggested that tax rises are more likely than costly new schemes for first-time buyers.
Government departments have been instructed to identify cuts to fund an additional £15 billion for defence over the next four years. This comes amid Cabinet disagreements about spending priorities. Meanwhile, MPs have called for stamp duty reforms to boost homeownership, reflecting ongoing concerns about housing affordability.
Earlier this year, reports indicated that a slowdown in new-build sales had prompted the Government to consider a successor to Help to Buy. The Ministry of Housing was said to be assessing the impact of previous rounds of the scheme on supply, prices, and buyer access. Help to Buy operated from 2013 to 2022, allowing buyers to purchase new-build homes with a 5% deposit and a Government-backed loan. Its closure has left a gap in support for first-time buyers.
Recent data from Savills shows that more than half of all first-time buyers now require financial assistance from family members to access the property ladder. Last month, the Scottish Government announced a new shared-equity scheme offering first-time buyers interest-free loans worth £10,000, highlighting different approaches to housing policy across the UK.
The decision not to revive Help to Buy is likely to impact the new-build sector and may increase pressure on alternative financing options for first-time buyers in England. Industry professionals will be watching for any proposed changes to stamp duty as a potential response to housing affordability challenges.
Source: PropertyWire