Help to Buy Ended March 2023

The UK government's Help to Buy scheme, which provided equity loans to first-time buyers and home movers looking to purchase a new-build home, officially closed on March 31, 2023. Aster can help guide you through the alternatives available and explain why shared ownership might be an alternative option for you.

Whilst Help to Buy had been in place since 2013 and helped thousands of people onto the property ladder, it closed to new applications on 31st October 2022. We can explain the difference in approach with shared ownership and why this may be suitable.

What exactly was Help to Buy?

Help to Buy allowed you, with as little as 5% as a deposit, to buy your own home with a traditional mortgage. The government supported an interest-free loan for 5 years but this was only eligible for new houses and there was a cap on how much you could spend in a particular area. You had 25 years to pay the loan back in full.

Shared ownership as an alternative to Help to Buy

Shared ownership is another government-backed scheme that aims to make home buying more accessible to people who may otherwise be unable to afford it. The scheme works by allowing buyers to purchase a share of a property and pay rent on the remaining share. This means that buyers can get on the property ladder with a smaller deposit. Options exist to gradually increase their share of the property over time. Why not contact us on 01380 735 480 for more information.

What is the difference?

Unlike Help to Buy which was an equity loan, shared ownership takes a different approach. It is a scheme where individuals can buy a share of a property (usually between 25-75% depending on the terms of the lease and buyer affordability) and pay rent on the remaining share. This enables individuals to purchase a home with a lower deposit and mortgage. Shared ownership properties can be either new build or resale, and the scheme is open to individuals who meet the eligibility criteria. Individuals also have the option of purchasing additional shares in the property, known as 'staircasing'. In some instances, depending on the terms of the lease, buyers may be able to go on to purchase their home outright. If this is something of interest to you, speak to a member of our team who can check the terms of the lease for you. This can take the pressure away from trying to gather a large deposit as you only need to raise a deposit based on the share of the home you are buying.

As the Help to Buy agent services will no longer be available, applicants for a shared ownership home will no longer need to submit an online application with the Help to Buy agencies. A new eligibility service administered by the government has taken it's place from 1st April 2023. If you were registered with a Help to Buy agent, Homes England should have contacted you regarding these changes and the impact on any ongoing applications.

Our new process will require you to complete our Aster shared ownership application form once you have seen a property you wish to apply for. Simply contact us when you find a property of interest, and we will assist you with taking the next steps.

We have lots more information about shared ownership as an alternative to Help to Buy here.

Am I eligible?

To qualify for shared ownership you must satisfy the following criteria:

• You must be 18 or over
• Your household is bringing in no more than £80,000 income a year (or £90,000 if you're in London)
• You don't own a home already
• You may be in the process of selling a home, however, to be able to buy a shared ownership home from us, the property sale must have an offer accepted before we will accept your application.
• You're able to show you can afford to maintain the costs of buying your own home
• You're a British or EU/EEA citizen or have indefinite leave to remain

Find out more

Aster can help you if you are considering shared ownership.

Contact us here or call 01380 735 480  – we’re here to help!