Property Equity Loan

Real estate equity loans

159,000 homes for sale through Help to Buy Equity Loan Since its introduction (1 April 2013 to 31 December 2017), almost 159,000 real estate assets have been acquired under the Help to Buy Equity Loan programme. Numbers from the Ministry of Housing, Municipal Administration and Municipalities show that the aggregate value of these equity loan was 8.27 billion, while the value of real estate assets disposed of under the programme was 39.28 billion pounds.

The equity loan programme was carried out by first-time purchasers and accounted for 128,317 (81%) of overall acquisitions. "Help to Buy remains a key tool in assisting first-time purchasers to enter the real estate business, which accounts for 81% of all first-time purchasers and around 20% of new construction in 2017.

"To date, this is the highest number of finishes per three months, and as the numbers increase year-on-year, the system is clearly being used more than ever by those who need it most. "However, as many know, the system's post-2011 outlook is not yet secure, and as more and more creditors enter the purchase assistance markets, we need to make a choice earlier than later to enable long-term plan.

"In the meantime, however, for those who are beginning to pay back their help to buy credit, it is a good beginning to get in contact with a real estate agent. Average acquisition cost of a property acquired under the programme was £247,230. At the time of regulatory finalisation, the corresponding value of these equity related borrowings was 6.50 billion (79%) of the equity total).

Aggregate value of property divested under the programme to first-time purchasers was 30.47 billion, 78% of aggregate value of property divested. The majority of Help to Buy Equity Loan deals (25%) ranged from £150,001 to £200,000, with 85% of deals being under £350,000. £150,001 - 200,000 was also the largest share of houses bought by first-time purchasers (28%).

Unsurprisingly, there were proportionally more first-time purchasers in the lower end and fewer in the higher end. Average sales prices were 237,495 for first-time purchasers, 288,099 for non first-time purchasers and 247,230 for all completed projects. From the start of the Help to Buy Equity Loan, from April 2013 to the end of 2017, 11,094 London real estate assets have been purchased with an equity loan.

From 1 February 2016, Help to Buy candidates were able to draw on an equity loan of up to 40% of the acquisition cost of real estate in Greater London. There were 6,867 completed projects in London (33 districts) between 1 February 2016 and 31 December 2017, of which 6,547 were carried out by first-time purchasers.

Duplexes were the most commonly oversold property with a 31% share of completion, followed by freestanding property with 30%. Initial purchasers bought proportionally more apartments and row homes and fewer single-family homes.

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