Most first time buyers are aware of the ‘Help to Buy’ scheme but many have poor understanding of the programme, new research from YouGov reveals.
The “First Time Buyers 2014” report shows that seven in 10 (71%) people who have got on the property ladder in the past two years and almost two thirds (65%) of people in the process of buying their first home are aware of any government home buying scheme. The most well-known one is ‘Help to Buy’ with 58% of existing first time buyers and 53% of potential first time buyers aware of the scheme.
However, despite widespread awareness, first time buyers lack understanding of the scheme. YouGov asked respondents to rank how well they understood how the schemes work on a scale of 1 to 7, with 1 meaning “I have no idea” and 7 meaning “I understand completely”.
The equity element of the ‘Help to Buy’ scheme scored 3.7 among those who have recently bought their first property and 3.8 among those currently looking to get on the property ladder. The mortgage guarantee part of the scheme scored 3.8 among both groups.
First time buyers are also unsure whether ‘Help to Buy’ is a good initiative. Over a third (36%) existing first time buyers and close to three in ten (28%) potential first time buyers associate ‘Help to Buy’ with making ‘home ownership affordable’. However, three in ten (30%) of those who have recently bought their first home and almost one in three (32%) of those looking to get their first property believe the programme will ‘cause a house price bubble’. Indeed, 24% of existing first time buyers and 22% of potential first time buyers say ‘Help to Buy’ is risky.
Tom Rees, Research Manager for YouGov Reports, says: “The government has regularly trumpeted the ‘Help to Buy’ scheme as a way of getting first time buyers on the property ladder and making housing more affordable for young people. However, while many people looking to purchase their first home know about the scheme, they have lower levels of understanding about how it works. In addition, first time buyers are split over whether it is a good or a bad thing – while many think it helps people like them get on the property ladder, as many think that it is helping to cause a housing bubble. With the Bank of England watching the housing market closely and the government hoping that the property market will continue to aid the recovery, ‘Help to Buy’ is sure to remain a controversial subject for the foreseeable future.”