Help to Buy is a government scheme (launched in February 2016) that helps first-time buyers who want to own a newly built home. The scheme offers an ‘equity loan’. This means that the government lends money for first-time buyers and existing homeowners to buy a newly-built home.
London Help to Buy is an extension of the existing Help to Buy loan scheme, designed specifically for London homes and buyers. The scheme applies to newly built London homes worth £600,000 or less and is available for first-time buyers and home movers.
Under the scheme, the government lends up to 40% of the purchase price and 5% is to be paid by the buyer in the form of a deposit. The remaining 55 % is covered with a mortgage.
For the first five years, there is no interest fee on the government’s equity loan. In the sixth year, the interest rate is 1.75%. After that, the fee rises by inflation based on the Retail Prices Index, plus 1% each year.
Originally, the scheme was due to finish in April 2021, but will now end in March 2023 – a two-year extension unveiled in the Budget of October 2018.
Our firm maintains an up-to-date list of London developers and housebuilders registered with the Help to Buy Scheme.