Half of lenders predict early finish for help to buy
03-12-2014
By Pete Apps
Nearly half of mortgage lenders and brokers surveyed believe spiralling house prices will force the government to pull the plug early on the help to buy scheme.
Research by the Intermediary Mortgage Lenders Association, a group of banks and building societies that offer loans through brokers, found increasing concern that part of the scheme could end before its three-year term.
Half the brokers and 46 per cent of lenders predicted an early finish to the part of the scheme which allows purchasers to buy a property with a 5 per cent deposit.
Just under 70 per cent of lenders said they expected the scheme to be derailed by rising house prices.
‘These findings throw the spotlight on crucial policy decisions that must be thought through to safeguard the recovery in mortgage lending and house building,’ said Peter Williams, the executive director of IMLA.
‘Whether or not the scheme runs its full course is less important than making sure we have a self-sustaining market in place going forward.
‘The evidence suggests that we have an entrenched mortgage market recovery which can survive its withdrawal.’