Help to Buy supported an average of 1,000 sales of new-build homes a week last year, mostly to first-time buyers – while helping developer Persimmon achieve record profits.
But the NAEA said that all Help to Buy does is distort the market by sucking first-time buyers out of the system.
Persimmon yesterday announced profits of over £1bn, with nearly half of its sales made under the taxpayer-funded Help to Buy.
The firm has also announced a new chief executive, Dave Jenkinson, replacing Jeff Fairburn who stepped down after a furore over his £75m pay packet.
In new data covering Help to Buy from its inception on April 1, 2013, to the end of last September, the Government revealed that there have been 195,219 purchases, funded by taxpayer-backed loans of £10.6bn.
The value of the homes sold under the scheme totalled £49.89bn.
Most of the purchases were by first-time buyers, accounting for 81% of purchases.
Trade body the Intermediary Mortgage Lenders Association says last year was the strongest yet for Help to Buy sales. It is predicting that there will have been 200,000 sales by the end of last year.
NAEA chief executive Mark Hayward yesterday told EYE: “We are seeing increased sales to first-time buyers running at about 26% of sales, with the slowdown in buy- tolet purchases helping the firsttime buyer to be in a more competitive position.
“Help to Buy, though, does not build chains as in effect the buyer is sucked out of the system.”
Property buyer and housing pundit Henry Pryor vented his anger on Twitter saying that 1,000 kids had woken yesterday morning in bed and breakfast accommodation “and government persists with a scheme that directly supports a company making £1bn profits . . . Am I cross? I’m f****** outraged”.
Also highly critical was Joseph Daniels, founder of modular house-building firm Project Etopia.
He said that the £10.6bn spent by taxpayers on Help to Buy was almost as much as the entire current police budget for England and Wales, at £12.3bn.
He said the scheme had created an “artificially robust market” in new-build, and that the amount of money spent on Help to Buy would have paid for over 43,000 homes at full market value.
Help to Buy’s current equity scheme, applicable only to the purchase of new-builds and not to the traditional secondhand stock held by estate agents, is due to continue until 2023, but will end for all except first-time buyers from 2021.
Yesterday, Persimmon shares climbed 48p, or just over 2%.
Full Article: https://www.propertyindustryeye.com/help-to-buy-purchases-running-at-rate-of-1000-sales-a-week/