The Quarterly Tracker Report from the Building Societies Association has revealed that 1 in 5 first time buyers believe the Government’s Help to Buy Scheme will assist them in getting a foot on the property ladder.
The report asked 2,000 consumers across the UK what they thought of Government initiatives to help people buy their first property. Feedback was generally positive, but there were some criticisms.
While people see price rises as positive for the overall health of the property market, it meant deposit amounts were also rising. Indeed, 54 per cent of respondents said that raising the deposit was the biggest barrier to buying.
Taxation on deposit savings was also an issue; 23 per cent want the Government to stop.
Warnings from experts
The BSA backed up recent warnings made by the Bank of England and the Office of Budget Responsibility – that the Help to Buy Scheme must not end up creating a housing bubble.
While Help to Buy is evidently helping first time buyers, it should not be a permanent feature of the property market, warned the head of mortgage policy at the BSA, Paul Broadhead.
Broadhead said: “Care is needed to prevent the actions taken today inadvertently causing a distorted housing market in three years time – a market where state intervention has artificially hiked prices.
“[But] if this and other schemes do encourage builders to build – increasing supply and improving consumer confidence, it will be a success.
He also recommended the Government stopped taxing deposit savings, in order to help buyers raise deposits more quickly.
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