Summary
Help to Buy was originally intended as a short-lived scheme but will now last for 10 years and consume over 8 times its original budget, yet the value achieved from its extension is uncertain. Around three-fifths of buyers who took part in the scheme did not need its support to buy a property, and the large sums of money tied up could have been spent in different ways to address a wider set of housing priorities and focus more on those most in need. The early scheme achieved its own aims to support people into home ownership, and boost the housing market. The scheme does not address issues with the wider planning system, or other problems in housing, such as the provision of affordable housing to buy or to rent and rising levels of homelessness, nor was it designed to do so.
The Department has other programmes to address these issues, but Help to Buy remains its largest initiative by value. The Department acknowledges that the scheme has, however, only benefitted one section of society—those that are in a position to buy their own home in the first place.
Inherent uncertainty in the housing market means there are still risks to the Department achieving a positive return on its investment in homes. The new scheme from 2021 provides an opportunity to target the money more effectively, but the Department has not yet fully thought out how it will do this. Unless the Department plans alternative housing initiatives, the end of the scheme in 2023 may lead to a fall in supply, adding to the challenge it already faces in achieving its ambition of 300,000 homes a year from the mid-2020s.
Published: 17 September 2019