In episode 71 of the Growth Series podcast, Nicola Alvarez, Senior Manager Mortgage Distribution - Proposition Development at Accord Mortgages, speaks to Craig Hall, Director of New Homes at LSL Financial Services, about the end of the Help to Buy scheme.
Nicola begins by asking Craig what impact Help to Buy has had on the housing market. He believes it’s had a major impact since 2013, supporting the purchase of 350,000 new homes in England until December 2021, encouraging developers to build much-needed homes, and helping lenders re-enter the sector following the credit crunch.
The pair then discuss the gap that will be left by Help to Buy, as Craig observes that the scheme is being withdrawn when inflation and interest rates are going up, adding to affordability pressures. He also points out that since lenders took a while to embrace Help to Buy, it will take time for them to get behind alternative schemes.
Next, Nicola asks whether buyers know about less well-known alternatives to Help to Buy, and Craig believes they don’t. As a result, he believes brokers have a key role to play by advising people on different government, private and lender schemes.
The conversation then turns to the role that clubs and networks can play in helping brokers to understand the alternative options. Craig says they have a huge role to play, as it’s important to keep up with the influx of new regulation and legislation affecting the sector.
Nicola and Craig then talk about how rising interest rates will affect the first-time buyer market. Craig states that although interest rates are still historically low, it is something to keep an eye on. He therefore believes advice is key, so first-time buyers are given the full range of options to help them both buy and keep their home.
Finally, Nicola asks what the new-build market will look like post-Help to Buy. Craig predicts it will become more complex and more specialist, which means customers will need more support and advice. He adds that it’s vitally important for brokers to stay as educated as possible and engage with lenders, BDMs, networks and mortgage clubs, as the next year will see “significant period of change” for this sector.
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00:52 to 31:31:
Introduction to the guest
The impact of Help to Buy
What gap will the end of Help to Buy leave?
Do buyers know about alternatives to Help to Buy?
What role will the clubs and network play in helping brokers to understand the alternative options?
Impact of rising interest rates on the first-time buyer market
Bank of England removing stress testing requirement
What will the new-build market look like post-Help to Buy?
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