The nation’s biggest housebuilder argued that shared equity in one form or another had become “fundamental” to the housing market and that removing it needed to be done very carefully to ensure the market remained sustainable.
Speaking at the MyHomeMove conference, Barratt Homes head of mortgage lender relations Adrian MacDiarmid (pictured) said the business was already planning developments for 2021 with the expectation the scheme would end.
“It’s a problem – 2021 feels like a long way away but actually it’s a problem now,” MacDiarmid said.
“One of the reasons housing supply is lower than anyone would like, is it takes a long time to go through an initial bid, planning, to putting spade in ground, selling it and taking it to completion.
“So land we are buying now we won’t be building units on until 2021 – so we’re taking decisions now based on the lack of availability of Help to Buy.”
Although MacDiarmid noted that discussions were “ongoing” about what the landscape would look like post-2021, he noted that these had been delayed by the election, which was “possibly not helpful”.
“The conversations are what does the landscape look like without Help to Buy or should there be a landscape without Help to Buy? But that’s clearly difficult without an active government to talk to,” he added.
Legal and General director of housing partnerships Stephen Smith was more upbeat, suggesting it might be in the government’s interest to retain Help to Buy.
But even if it did not, he felt the mortgage market would find a solution.
“The industry found a way to get through the end of the mortgage guarantee part of Help to Buy as there were more lenders offering 95% loan-to-value mortgages outside [the scheme] than within it when it ended,” he said.
“I don’t believe the government has lost any money on Help to Buy, by definition it’s probably making money, so why would you not keep it as a feature of the market, particularly if its needed to underpin the house building we need.
“So I think in light of self-interest, with the next election 2022, that’s not a good time to pull a major scheme,” he added.