Help To Buy scheme 'offering blank cheque to builders'

Families earning more than £100,000 and people moving up the housing ladder are among those taking advantage of a Government scheme which is offering a "blank cheque" to builders, Labour has claimed.

The Help To Buy scheme, which offers loans guaranteed by the state for up to 20% of a property's value - or 40% in London - is aimed at boosting home ownership.

But shadow housing minister John Healey said the programme was poorly targeted and called for a cap on the total income of households eligible to take part.

Some 3,952 households in England earning more than £100,000 annually have bought a home using the Help To Buy Equity Loan scheme, out of a total of 112,338 completions.

The Government offers the equity loan to buyers of newly-built properties worth up to £600,000.

Mr Healey told BBC Radio 4's Today programme: "I don't think it's right that taxpayers' help is going to people who are earning over £100,000, many of whom say they could have afforded to buy that without that help.

"A lot of this help is not even going to people who are buying for the first time. So ministers have got to do a great deal more to target this scheme on help for those with ordinary incomes, younger people who really need the help most."

While more than 90,000 of the purchases were by first-time buyers, the figures showed that more than 20,000 were people moving up the housing ladder.

Mr Healey said the scheme should be limited to people getting on the housing ladder for the first time and there should be ban on people with "sky-high incomes" from getting the support - although he would not put a figure on where the cap should be set.

"There is no earnings limit on the scheme now, and there should be. There is no restriction on the scheme being for first-time buyers, and there should be. It should be targeted especially on younger people, people on more middle incomes, ordinary incomes.

"Really, the Government should be demanding more of the housebuilders.

"This is a scheme that is part of nearly £43 billion set to go from the taxpayer in support of commercial housebuilders over the next few years.

"In many ways, Help To Buy is a blank cheque from ministers which housebuilders are cashing in on."

Mr Healey said more needed to be done to help younger people get on the housing ladder.

"For younger people, home ownership is in freefall. There are a third of a million fewer homeowners now who are under 40 than there were in 2010."

A Department for Communities and Local Government spokesman said: "Since 2010, Government-backed schemes have helped more than 362,000 households to buy a home, with the number of first-time buyers more than doubling since 2009.

"We have been clear that we need to fix the broken housing market so that homes are more affordable and people have the security they need to plan for the future - and our recent housing white paper set out the measures to do just that."