The Equity Loan part of the Government's Help to Buy scheme has got off to a 'flying start', according to new figures released by the Home Builders' Federation (HBF).
Over 4,000 people have reserved homes in the past two months under the Equity Loan part of the initiative, with an average of 500 reservations being made on a weekly basis.
Introduced by the Government as a successor to its FirstBuy initiative, the Equity Loan scheme offers to help buyers with deposits of 5% to secure a mortgage on new-build homes in England. The Government also provides an equity loan of up to 20% of the property value.
Whilst the Equity Loan part of the Help to Buy scheme aims to directly assist struggling buyers with purchasing a home, the second half of the initiative, known as The Mortgage Guarantee, has been designed by the Government to kick-start the overall housing market.
Under The Mortgage Guarantee, the Government has pledged to guarantee a portion of losses incurred by lenders from repossessions on 95% mortgages across the housing market with effect from January 2014.
Stewart Baseley, executive chairman of the HBF, said: "The Equity Loan has been an unqualified success so far and 4,000 reservations in just two months and shows both the consumer demand for the scheme and developers' commitment to it.
"The large deposits required in recent years to secure a mortgage have prevented many from buying and as a result, builders from building," he said.
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