Government schemes to promote home buying have had a positive impact on the West Midlands housing market, according to a new survey.
Demand for property in the region rose during April, as the Government’s announcement on the Help to Buy scheme began to make an impact on the housing market, according to the latest RICS residential market survey.
Last month, new buyer enquiries rose to their highest level since October 2012, with 20 per cent more chartered surveyors reporting demand for property rose.
The Government’s Help to Buy scheme offers both an ‘equity loan’ where the Government will loan up to 20 per cent of the value of a new build home and a ‘mortgage guarantee’ where lenders will be incentivised to make more mortgages available for people with small deposits. The equity loan scheme is available now and the mortgage guarantee will be available from January 2014.
RICS said the latest jump in enquiries, from three per cent more in March, strongly suggests that along with the existing Funding for Lending scheme, Help to Buy is attracting interest even if the mortgage guarantee element of the product is not due to come into effect until next year.
Newly agreed sales in the West Midlands improved too, with 33 per cent more surveyors reporting sales rose during April – a dramatic improvement from three per cent in March.
Richard Franklin, RICS residential spokesperson for the West Midlands and partner at Edward Gallimore, said: “It is encouraging to see government initiatives are having an impact on the property market.
“Help to Buy in combination with the Funding for Lending scheme appears to be giving the market in the West Midlands a shot in the arm.
“There are some understandable concerns that the Help to Buy measures will also eventually lead to higher prices for new homes, however with the scheme extending to more affordable previously owned stock next year, this should lessen this probability.
“The increase in volumes will be a far better indicator that the market is returning to rude health than headline sales figures.’’