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Large housing association writes to housing minister to plead for Help to Buy extension

One of the country’s largest housing associations has written to housing minister Christopher Pincher calling on the government to extend the deadline for Help to Buy purchases to complete, claiming that without an extension many first-time buyers would miss out on their dream of owning a home.

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Picture: Getty
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London housing association @MetTVH has called on the government to extend the deadline for purchases on current Help to Buy programme, claiming many will lose homes if not enacted #UKhousing

Metropolitan Thames Valley Housing (MTVH), which owns and manages 58,000 homes, wrote to the minister on Friday explaining that the deadlines for completing Help to Buy needed to be extended due to the COVID-19 restrictions slowing down the completion of some developments and, in turn, the completion of sales.

The current Help to Buy programme was launched in 2013 under then prime minister David Cameron to help first-time buyers onto the property ladder. Under the existing system the government provided loans of up to 20% – or 40% in London – of the price of a new build home.

In 2018, the government announced that it would be extending the programme for an additional two years, with Help to Buy now running until at least 2023. But the new programme, which begins in April, will have regional price limits set at 1.5 times the average house price for a first-time buyer.


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With the new programme expected to begin in April, the government has set a deadline of 28 February for all new build purchases to be completed and a deadline of 31 March for all transactions to be finished.

Kush Rawal, director of residential investment at MTVH, wrote in the letter that these deadlines were problematic and said that without extending these deadlines “a wave of first-time buyers’ purchases would be disrupted or may collapse”.

He added that in some cases buyers may incur additional costs or abandon their purchases entirely.

MTVH currently has many first-time buyers looking to use the scheme, but the pandemic’s impact on the construction sector has meant the completion of some developments has been delayed. These purchases cannot be completed until the developments are completed.

Mr Rawal urged the government to bring in an extension for purchases that have progressed to the point of completion but are delayed because developments are unfinished.

He also demanded that the 31 March deadline for purchases also be extended, so that other purchases are not negatively affected.

He said that this is an issue facing many housing providers and that by showing flexibility the government would be supporting many first-time buyers to realise their dreams of owning their own homes.

The letter came as MTVH saw a record level of interest in late 2020, despite the pandemic. The association said that it experienced an 88% increase in enquiries compared with 2019 and that it delivered a record 59 completions and 70 exchanges.

Several other housing associations have reported a major uptick in interest in shared ownership and private sale homes. In September, Aster, Clarion and Notting Hill Genesis all reported a significant year-on-year increase in enquiries about private sale and shared ownership purchases.

Some of this is likely due to the government’s slashing of stamp duty on new purchases, as well as people having more desire to move home after lockdown.

An MHCLG spokesperson said: “While construction can continue during the national lockdown, we recognise there have been delays caused by the pandemic.

“That’s why we extended the Help to Buy build deadline by two months to 28 February 2021 and provided extra flexibility on the purchase deadline until 31 May 2021 to protect existing reservations made before 30 June 2020.

“We are aware of the concerns raised and are continuing to monitor the situation.”

 

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