The number of properties available in London under Help To Buy has declined by 64.3 percent since 2017. Contributor Joseph Daniels, CEO – Project Etopia.
First-time buyers sprang into action when the government’s housing scheme was first launched in 2013, making the most of the equity loan which, in the capital, covers up to 40 percent of a new build home worth up to £600,000.
However, properties available under the scheme are swiftly disappearing. The number of properties available under Help To Buy in London has fallen to 1,619 from 4,535 in December 20171. Houses available across London under the scheme have also been disappearing at an alarming rate.
At the end of 2017, houses available under HTB were extinct in a quarter of all boroughs but that has now risen to nearly half 15 boroughs). The area worst affected by a shortage of Help To Buy properties is Hammersmith & Fulham where, at the time of the study, there was only one property left – a £595,000 1 bedroom flat.
Among the boroughs with the lowest number of Help To Buy homes available, Kensington and Chelsea has three, and Westminster has four.
House building statistics appear to show that the Help To Buy drought is purely due to developers not being able to keep up with demand. The number of houses completed in London by private developers remained stable in the past 12 months at 17,430 (Q4 2017 to Q3 2018). This was only marginally down on the 17,770 completions in the previous 12 months2.
Over the same period, the number of properties bought in London with Help To Buy has risen 23.7 percent in a year to 5,156 in the 12 months to September 20183.
In total, 20 out of 32 boroughs have fewer than 50 Help to Buy properties for sale, compared to seven in 2017. Houses make up just 5.4 percent of the overall stock across the capital, declining from 13.3 percent of all Help to Buy properties in London in December 2017.
Joseph Daniels, CEO of Project Etopia, commented: “It’s all very well giving buyers a leg up but it’s no good if the properties aren’t there in the first place.
“Building rates in the capital are relatively stable but the popularity of Help To Buy is surging and developers just cannot keep up with demand.
“The gradual extinction of Help To Buy homes in London demonstrates that interest-free government loans are not the answer to the housing crisis. Only rapid house building on a large scale and innovative ideas, including modular construction, will prove to be a lasting antidote.
“Families are being particularly hard hit, with houses available under Help To Buy now extinct in half of London boroughs, pushing overwhelming demand into other boroughs or forcing people out of the capital altogether.”
