Help to Buy 2 came into play in an attempt to improve on, or offer an alternative to, the first Help to Buy scheme. However, despite the aim of it to be to offer low deposit mortgages, we have seen the average deposit on the scheme rise.
By giving lenders the fallback of a government guarantee to bail out homeowners should they fall into arrears on their mortgage bills, the scheme aims to bring deposits, one of the biggest obstacles for a first time buyer, down to as little as 5 per cent.
With a climbing average deposit, however, it may not be achieving its aims as well as it could be.
This figure rose for three consecutive months since November, when it stood at £7,856. By February, it had reached £9,936. This is still below the high seen in April of 2014, which saw an average deposit of £11,438.
Throughout its life, the Help to Buy 2 Mortgage Guarantee scheme has been the target of a lot of criticism as it did not appear to be achieving its aims. With high deposits, it was thought to be helping those who were buying larger, more expensive houses, and people who could afford these would, theoretically, be in a better position to purchase a home without aid from the government.
Many factors could be leading to this rise, however. Mortgage deals may be becoming less abundant, leading to worse loan to value mortgages on offer, house prices may be rising, or more homes could be being sold in the more expensive areas of the country.
Either way, for the Help to buy scheme to be the most useful and effective it can be, it needs to be available to people who can’t gather a large enough deposit to make it onto the property ladder by themselves.