After helping thousands of first-time buyers onto the property ladder, the Help-to-Buy equity scheme is drawing to a close. But it’s not time to hit panic stations just yet - you can reserve a Help-to-Buy property up until October, and there may even be a replacement on the way! 

But first, what is a Help-to-Buy equity loan? 

Originally stepping in to boost the housing market in 2013, the Help-to-Buy equity loan scheme made it easier for first-time buyers by giving them a government loan of up to 40% towards their dream home. The loan is interest-free for up to 5 years, followed by an interest rate that rises or falls according to the property value. This meant that you could end up landing the apartment of your dreams with as little as a 5% deposit!  

The goal was to give an alternative option to aspiring homebuyers who couldn’t afford the hefty cost of a standard mortgage. Since December 2020, the loan became only available to first-time buyers who were after new build homes. The gap that the scheme leaves could be huge - it accounted for a whopping 31.4% of all new home sales across the UK! 

When does Help-to-Buy end? 

To avoid missing the Help-to-Buy boat, you need to reserve your property by the end of October and complete your purchase by March 2023. There have been talks about an extension, but nothing has been confirmed yet! Elsewhere, people who have Help-to-Buy ISA accounts have until December 2030 to claim their 25 per cent bonus. 

Help-to-Buy equity loan scheme made it easier for first-time buyers by giving them a government loan of up to 40% towards their dream home.

Help-to-Buy equity loan scheme made it easier for first-time buyers by giving them a government loan of up to 40% towards their dream home.

Will anything come in to replace Help-to-Buy? 

Help-to-Buy was a huge help for first-time buyers who dreamed of home ownership, but didn’t have the funds to do it straight away. So it feels natural to wonder, what support tools are left for first-time buyers now?  

At the moment, the Lifetime ISA presents itself as a sort-of replacement for the Help to Buy ISA. Get a Lifetime ISA and you can take advantage of a 25% bonus on your savings every time you pay in. Best of all, you can deposit more each year, and over a longer period of time!  

But first-time buyers may soon have even more avenues to get on the housing ladder. The government is also planning a new scheme called ‘First Homes’, where certain properties will be sold for between 30 and 50% below market value.  

However, the best alternative may already be hiding in plain sight - Shared Ownership can turn the difficulty of saving up a deposit into yesterday’s news. Giving you the option to buy a share of your home while you pay rent on the part of the home that the government owns, this is a hugely popular option for first-time buyers looking to buy a home without losing all your savings in one go. 

Want to beat the deadline for Help to Buy? 

As well as having plenty of Shared Ownership homes to choose from, Peabody still has a selection of stunning apartments available to buy through Help to Buy. Don’t waste time - reserve your future home today! 

Find a home with Peabody

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