Author Archives: Carl

Help to Buy could swell transactions by 75%, says Carl King @ Lynks Estate Agents

Friday 15th November 2013

The second phase of Help to Buy could boost current transaction levels by 75% a year, Carl King has said.

The firm, in its forecasts for 2014, said that the first phase of Help to Buy – available on new homes only as a shared equity scheme – has had a “noticeable” effect.

Lynks Estate Agents report says: “Some 15,410 buyers have already used the loan to augment their deposits for a new-build home.

“If take-up for the scheme continues to proceed at this pace, funding will run out in mid-2015 before the scheme is due to end in early 2016.”

Of the second phase of Help to Buy, a mortgage indemnity scheme available on both new and secondhand stock, the firm says: “[This] was launched three months earlier than planned by George Osborne.

“A month in, around 2,800 buyers have submitted offers for homes, around three-quarters of these being first-time buyers. The average purchase price has been £163,000.

“If this trend were to continue, the number of mortgages which could be approved under the scheme could be as high as 1.5 million, boosting current transaction levels by 75% a year and taking sales volumes back to levels seen in 2005.”

The firm adds that the full range of mortgage products for the second phase of Help to Buy is not yet available. It says that as more lenders offer mortgage deals under the scheme, rates will come down.

Mr King who is experienced both in the London and UK wide property market and considered a property professional forcasts steady price rises into next year. Carl and Lynks Estate Agents plan to give all the information they can to buyers in the North West. Carl said ” With the Help to Buy scheme being launched this will help not only first time buyers to get onto the property ladder but also purchasers who currently are selling and moving on as long as its not a second home purchase.

“For the first time in five years we can be broadly positive about the UK housing market.”
Property sources forecast 8.4% house price inflation in London, and elsewhere, price rises in all the regions of between 6.3% and 7.6%.(stats from Knight Frank)

We explain what you need to know about Help to Buy – the government’s schemes aimed at first-time buyers with low deposits and current owners with limited equity.


Help to Buy is expected to help make up for the lack of higher loan-to-value products available.

While it’s still occasionally possible for people with a deposit of only 5% to get on the property ladder, the government felt there should be more competition between mortgage lenders to provide greater choice to home buyers.

Savings rates and wage increases are also well below the rate of inflation, making it harder for buyers to save a deposit.

Another big reason for the introduction of the scheme comes down to current house prices, which have risen by 3.3% in the past year. If they continue to rise at this rate, people with deposits of 5% to 10% will find it even harder to buy a property in the future.

Help to Buy has so far been very successful. The number of homes bought through the equity loan scheme topped 12,500 by the end of August 2013, putting it on track to meet the government’s target of 74,000 homes by 2016.

 Help to Buy – key facts

Mortgage guarantee scheme – what you need to know

If you’re thinking of applying for the Help to Buy mortgage guarantee scheme, you’ll need to consider the following:

  • Borrowers will need to pass affordability checks with mortgage lenders. This varies by lender, but usually involves them checking that you’ll still be able to meet payments should interest rates go up.
  • Borrowers will need to state that they have no interest in any other property worldwide, or won’t have by the time they complete on a mortgage guarantee scheme mortgage product.
  • You may be able to apply if you’ve had minor credit problems in the past, but you’ll still need to pass the mortgage lender’s credit checks.
  • Borrowers need to have at least a 5% deposit, and be able to cover costs, for example Stamp Duty and any legal and valuation costs.
  • If you want to rent out the property you’re going to buy, the Help to Buy schemes