Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps he is taking to provide support to young families saving to buy their first home.

The Government is committed to supporting people of all incomes and at all stages of life to save, particularly younger individuals and families saving for their first home, through a programme of ‘own your home’ schemes. The following schemes are part of a package of measures to help people to save for their first house deposit and increase the supply of low-deposit mortgages for credit-worthy households.

The Help to Buy: Equity Loan is available to all those who aspire to own a new build home, but struggle to access or afford the repayments on a low deposit mortgage. Under this part of the scheme the government provides an equity loan worth up to 20 per cent of the value of a new build home, interest free for the first five years. The equity loan must be paid back to the government on sale, or when the mortgage is repaid. This scheme has been extended to run until March 2023.

In 2017, the government launched the Lifetime ISA (LISA) to support younger people saving for a first home or later life. Adults under 40 can open a LISA and save up to £4,000 each year until they turn 50. The government provides a generous 25 per cent bonus on all LISA contributions within these limits. These funds, including the government bonus, can be used as a deposit to purchase a first home up to the value of £450,000.

First-time buyers can similarly continue to save through a Help to Buy: ISA (now closed to new accounts) when saving to get onto the property ladder. The Government provides a 25 per cent bonus based on the account holder’s balance with a maximum bonus value of £3,000. Those participating into the scheme can continue saving into their account until November 2029 and have until December 2030 to claim their bonus.

In response to the reduced availability of 95% Loan To Value (LTV) mortgages following the pandemic, the Government launched the mortgage guarantee scheme in April 2021 to reinstate the market for 95% LTV products and to support households who struggle to get a mortgage because of the very large deposits required by lenders but who can afford the mortgage repayments with a 5% deposit.

The full list of Government schemes to help people own their own home is available here: https://www.ownyourhome.gov.uk/