Public Accounts Committee - Help to Buy
The HFi's former Chairman, Sir Mark Boleat, today appeared in front of the House of Commons' Public Accounts Committee to discuss the National Audit Office's recent Help to Buy report.
Sir Mark gave evidence alongside David O'Leary, Policy Director for Home Builders Federation and Professor Christine Whitehead, Emeritus Professor of Housing Economics at the London School of Economics.
The witnesses each gave their view on the Help to Buy scheme, with a focus on whether the scheme had achieved its objectives, was value for money and its impact on supply and demand.
As we wrote recently, some of our top take-away points from the report are:
- 2031/32 is the year by which the Department estimates it will have recouped its investment in full.
- 81% is the proportion of Help to Buy loans provided to first-time buyers in England, at December 2018.
- The Department expects the scheme to support around 352,000 property purchases by March 2021, via loans totalling around £22 billion in cash terms.
- 63% of first-time buyers were aged 34 and under.
- The rate of building had increased by 14.5% because of the scheme. By comparing prices paid for similar new-build properties in the same area with and without the scheme, we estimate that buyers supported by the scheme have paid less than 1% more.
- The scheme is therefore delivering value so far against its own objectives - those objectives being to "deliver the homes the country needs", through increasing home ownership and increasing housing supply.
- The Department is currently forecasting a positive return on its investment and redemptions are running ahead of expectations.
While the session mainly revolved around the Help to Buy scheme, Sir Mark used the opportunity to inform the cross-party committee of his views on the planning system.
As he wrote in his report for the Housing & Finance Institute – available here – his view is that the planning system requires radical reform. He stressed that the current system does not work and we need to ensure that planning decisions in local authorities are joined-up with wider policy objectives.
Sir Mark also spoke about the work of the HFi including the Institute's research on utilities and the Green Belt, arguing that while the Government has made progress on some of these matters, more work needs to be done.
Click here to see a clip from the session.
