VH: How many applications did you see on launch day?
MJ: We saw Help to Buy 2 applications from the very first day. Perhaps of more relevance is the fact we’ve seen a dramatic rise in decision in principles (DIPs). Unlike some other lenders Halifax DIPs only leave a soft footprint, but our numbers have stepped up dramatically since Friday 11 October.
VH: Halifax was the only Help to Buy lender to launch both direct and through intermediaries. Which channel has seen more enquiries in the last week?
MJ: No distribution patterns have emerged yet.
VH: Anecdotally, brokers report flurries of Help to Buy enquiries, which are not always converting into full applications when people understand the scheme better or realise there is no loan element with Help to Buy 2. Has that been your experience?
MJ: I haven’t heard that. This product has been invented to solve a problem, a problem for people with smaller deposits. One thing is very clear. There are a range of government schemes available and what we have is a first-time buyer and home mover mortgage lending product at 90 to 95% LTV. We launched with a two-year fixed rate at 5.19% with a £995 product fee. We’ll fill in the gaps later with other products.
VH: What feedback have you had from brokers?
MJ: The reception has been overwhelming from brokers and customers. I think this is a great solution. It’s interesting that a lot of the pre-launch speculation centred on the fact the rates would be 6%+, so the launch rate of 5.19% looks like a good deal.
VH: Who has been applying for Help to Buy 2?
MJ: It’s very early days but has been skewed more toward first-time buyers so far. No north-south divide either, so nothing to suggest a regional bias or that we are testing the top of that £600,000 cap. However, we’ve been genuinely thrilled with the levels of Decisions in Principles obviously giving people the green light to look for a house which will convert into completions in the coming months.
VH: Has the early, rush-to-launch of Help to Buy put lender-broker relationships under pressure?
MJ: We’ve been having a very busy, successful time. What a year. Help to Buy has made us a little busier and I am pleased the scheme emerged as straightforward. Like everything, it has taken some reassurance to advisers that nothing much has really changed – which our BDMs are really good at.
VH: Are you expecting Help to Buy 2 to perform like Help to Buy 1, which has seen exponential growth since its spring launch?
MJ: They are complimentary and will overlap in time in the new-build sector. The fact we are off the blocks means we’ll see a faster finish to this year than would normally be the case. We’ll probably revert to a more normal pattern next year. Right now the figures are commercially sensitive, but I’ll be happy to talk again soon.
