The MGS is a more market encompassing version of the Help to Buy scheme and can be utilised on new-build and existing homes by first-time buyers, those remortgaging and home movers. However, it’s not open to buy-to-let purchases, second homes or properties with a market value in excess of £600,000.
But how has it been received and how does it compare to the popularity of Help to Buy equity loan scheme?
Take up vs Help to Buy (equity loan scheme)
Since Q2 of 2021, 12,388 sales have completed with the help of the scheme, with the value of these loans exceeding £2.2bn, fuelling almost £2.4bn worth of property purchases.
During the same period, the Help to Buy equity loan scheme aided 27,112 transactions with £1.9bn in equity loans facilitating £7.9bn worth of property sales.
However, Help to Buy has been established for far longer in its various forms and when comparing the success of the MGS to the early days of the Help to Buy equity loan scheme, the uptake is far more similar. In fact, when Help to Buy first launched in Q2 of 2013, it helped just over 14,000 buyers to get a foot on the ladder in the same time the MGS has helped nearly 13,000 buyers.
Where is homebuyer appetite for the MGS the strongest?
So far, 24% of the 12,388 transactions to complete with the help of the MGS have been located in Scotland. The North West has also been home to a high percentage of MGS completions at 12%, as has the South East at 10%.
Northern Ireland (3%) and London (4%) account for the lowest level of MGS transactions.
Although it’s open to all buyers, 86% of all completions coming via the MGS have been first-time buyers.
While London may be home to one of the lowest levels of MGS transactions, 92% of those utilising the scheme in the capital are first-time buyers.
Colby Short, Founder and CEO of GetAgent.co.uk, commented: “House prices have spiralled to record highs during the pandemic and so it’s fair to say that the nation’s homebuyers need all the help they can get, first-time buyers especially.
"The Government’s latest attempt to provide this help certainly seems to serve a purpose, aiding a similar level of transactions as the Help to Buy equity scheme did in its early days, the majority of which have been first-time buyers.
"The question is, are government schemes designed to feed demand without addressing supply really the answer?
"We saw how this approach via the original Help to Buy scheme ironically pushed house prices even further out of reach of the average person. Now we have two such schemes running in conjunction with each other, at a time when property values are already climbing at an alarming rate.
"Surely a consistent approach to actually building more houses would be a far more sustainable way to address affordability in the long run?”
