The Government’s Help to Buy scheme has helped so many people buy their first home and take a step onto the property ladder since its launch in 2013.
The current scheme offers new homeowners an opportunity to buy a newly built home worth up to £600,000 with just a five per cent deposit.
However, from April 2021, new price caps are being introduced to the current scheme across England, which could limit prospective homeowners ability to get onto the property ladder.
The new scheme will still allow buyers to secure a mortgage on a new home with a five per cent deposit, but now the government has drawn out new regional price caps that may prove restrictive for some.
New research from money.co.uk has revealed that the average price of a new build home within 13 cities across the country are significantly higher than their regional price cap.
It’s well-known that Cambridge house prices are extortionately expensive, so it’s no surprise that our academic city tops the list of places with the biggest different in average new build home price versus the regional cap.
The average cost of a new build home in Cambridge is £606,151.
This is almost £200,000 more than the government has capped the scheme within the cities region, the East of England, where the cap is £407,400.
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This means the difference in average new build home price versus the regional cap is a whopping £198,751 more.
To put it into perspective, second on the list is the Yorkshire city of Ripon, where the price cap is set at £228,100 compared to an average new build home price of £348,414 – meaning a difference of £120,324.
This is still a large difference, however it’s more than £70,000 less than the difference those in Cambridge will face.
|City||Region||Price Cap||Average New Build Home||Difference in average new build home vs regional cap|
|Cambridge||East of England||£407,400||£606,151||+£198,751|
|Ripon||Yorkshire and The Humber||£228,100||£348,424||+£120,324|
|York||Yorkshire and The Humber||228,100||£345,619||+£117,519|
|St Albans||East of England||£407,400||£446,691||+£39,291|
|Leeds||Yorkshire and The Humber||£228,100||£247,455||+£19,355|
Overall, new build homes in one in four (26%) cities across the country have an average new build house cost above their regional price cap.
First Time buyers looking to purchase in any of the 13 cities that would not be eligible for the new scheme should try to purchase a home on the existing scheme prior to March 31, if it is financially possible.
When it comes to the most popular place in the country for first time buyers to invest in a property through the scheme, you just have to hop down the road to Central Bedfordshire, with nearly 4,000 homes purchased through the scheme since it launched in 2013.
However, the average price of new build homes in Central Bedfordshire are in fact £1,234 higher than the £407,400 price cap being introduced in the region in April 2021.