A YORKSHIRE city is leading a property boom through the Government’s flagship Help to Buy scheme as the number of UK house sales looks set to top one million this year for the first time since 2007.
More than 5,000 new-build homes have been bought in England as a result of the initial phase of the scheme, which offers equity loans to help borrowers with only a small deposit saved who want to buy a house worth up to £600,000.
The Government said the highest number of Help to Buy sales so far have been in Leeds, Wiltshire, Milton Keynes and Reading.
The new figures also showed that a total of 32,230 new-build homes were started between July and September this year, marking the highest quarterly figure seen since 2008.
Overall house sales are on course to pass the one million mark as first-time buyers, people paying with cash and buy-to-let investors drive a market revival.
The Council of Mortgage Lenders (CML) said first-time buyer transactions had been “among the first to show signs of recovery” and some 270,000 house sales were expected to involve this sector in 2013, a 40 per cent increase on 2009.
The number of buy-to-let transactions was also set to see an 80 per cent increase compared with levels seen four years ago, with the total expected to reach 160,000 this year.
The prospect of decent rental returns amid strong levels of demand from tenants was said to have attracted more landlords into the sector.
Transactions involving cash buyers were set to reach around 370,000 this year, marking a 25 per cent increase on four years ago.
But the CML said the number of property sales involving home movers had so far shown only “negligible signs of recovery” amid indicators that former first-time buyers were still finding it a struggle to take their second step on the property ladder.
The number of house sales involving home owners with a mortgage has risen by just three per cent since 2009, with around 325,000 mortgages expected to be taken out by this sector in 2013.
Many would-be “second steppers” will have bought their first property at the height of the boom and some will have sunk into negative equity as the financial downturn took hold.
The CML, which represents banks and building societies, suggested that some were still having difficulty “bridging the gap” and raising the funds needed to buy their next home.
It also cautioned that despite the recovery, first-time buyer numbers were still “languishing” at only around half their long-term average of around half a million.
Some 1.6 million UK property sales were recorded by HM Revenue and customs in 2007, a figure which plummeted to 900,000 in 2008.
On the building side, 117,110 new homes were started in the 12 months to September, representing a 16 per cent increase on the previous year, although housing charity Shelter said the number of homes being built is still less than half of the levels needed to keep pace with demand.
Shelter , chief executive Campbell Robb said: “What these figures show is that despite the Government’s claims on Help to Buy, it’s failing to deliver the volume of new homes we need.
“We’re building less than half of the 250,000 homes needed each year just to keep up with demand, and the small increase in housebuilding starts is no way near enough to get close to this total.
“For many young people on average incomes a 95 per cent mortgage with Help to Buy simply isn’t affordable and, coupled with rising house prices, sees the dream of a home of their own slip further and further out of reach.”