Hundreds of house purchases rescued after buyers feared sales would collapse
Hundreds of first-time buyers have been handed a lifeline after the Government extended a key deadline for the Help to Buy scheme.
Purchases risked falling through after delays in the construction industry meant many homes would not be completed by the previous Dec 31 deadline. The Department of Levelling Up, Housing and Communities has confirmed builders will now be given until Jan 31 to complete these homes.
First-time buyers had been able to use the scheme to purchase a new build home with a 5pc deposit and a 20pc Government-backed equity loan, or 40pc in London.
Registrations for new applications closed on October 31, but Government rules initially dictated that construction on homes must be finished by the end of the year, or they could not be purchased using the loan.
However, the housing department intervened after warnings that hundreds of first home sales would collapse as builders struggled to cope with supply chain issues and labour shortages.
The new deadline is now January 31, allowing more time for properties to register for the Help to Buy scheme.
While the delay will be welcome news for prospective first-time buyers, concerns remain that it will not be enough time for housebuilders to catch up with industry-wide delays. The Home Builders Federation, a trade body, had urged the Government to extend the practical completion deadline by two months to the end of February.
Prospective buyers who have already cancelled their reservations for new homes will be unable to return to their deals, even if their homes could be completed by the new deadline, according to the trade body. There would also be no opportunity for new registrations.
A spokesman for the Department of Levelling Up, Housing and Communities said: “Supporting aspiring homeowners is a Government priority. We have extended the Help to Buy deadline to make sure people do not lose out because of delays to completing their homes. House builders must ensure they finish building work on all properties by January 31. The legal completion deadline remains March 31.”
