The Help to Buy scheme, which was first launched in 2013, has been relaunched in the UK in 2021. The scheme is designed to help first-time buyers get onto the property ladder by providing them with a government-backed loan of up to 20% of the purchase price of a new-build property. The loan is interest-free for five years and can be used to cover the deposit or part of the mortgage.
However, there are concerns that the relaunch of the Help to Buy scheme could lead to house price inflation. This is because the scheme could increase demand for new-build properties, which could lead to an increase in house prices. This could make it more difficult for first-time buyers to get onto the property ladder and could also mean that existing homeowners may not benefit from any increase in house prices.
In addition, there are concerns that the Help to Buy scheme could lead to a rise in house prices in areas where there is already high demand for property. This could mean that house prices in these areas become unaffordable for many people, making it even more difficult for first-time buyers to get onto the property ladder.
The government has taken steps to try and address these concerns. For example, they have limited the amount of money that can be borrowed through the Help to Buy scheme and have also introduced measures to ensure that the scheme is only used by first-time buyers.
However, it remains to be seen whether these measures will be enough to prevent house price inflation. It is therefore important that the government continues to monitor the situation closely and takes further action if necessary.
Overall, while the Help to Buy scheme could help first-time buyers get onto the property ladder, there are concerns that it could lead to house price inflation. It is therefore important that the government takes steps to ensure that this does not happen and continues to monitor the situation closely.