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New build homes up 6%

New build homes up 6%

Category: Mortgages

Updated: 15/08/2013
First Published: 15/08/2013

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Latest figures showing a 6% rise in the number of new build homes being built have confirmed that the housing market has finally turned a corner following the credit crunch, the Government has announced.

29,510 new homes were built between April and June this year - a 6% increase on the previous quarter and a third higher than the same time last year.

The news comes after the Government said on Tuesday that 10,000 reservations for new build homes had been made since the launch of its Help to Buy Scheme four months ago.

"This Government's package of measures to boost the housing market is working, with house building and housing supply on the up," Housing Minister Eric Pickles said.

"With over 10,000 reservations in four months, it's clear that the Help to Buy: Equity Loan is working well. By dealing with the big challenges, we are helping thousands of young people and families get on and move up the housing ladder, and Britain is building again," he added.

However, the Government has faced mounting criticism that the second part of Help to Buy, due to be launched in January, risks creating another house price bubble, by further boosting demand for housing, and thus pushing prices up significantly, without increasing supply.

Some industry experts have even urged the Government to scrap the second part of the scheme. Under the equity loan part of Help to Buy, the Government will offer guarantees to lenders offering mortgages to buyers with a deposit of between 5% and 20%.

"Should the housing market gain substantial momentum over the coming months, the case for dropping the Help to Buy mortgage guarantee scheme . . . will strengthen," said IHS Global Insight chief UK and European economist Howard Archer, according to the reports.

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