Wait until 2014 for H2B
Springtide has urged homebuyers not to rush too quickly into taking Help to Buy mortgages as it predicts the lowest rates will not become available until January 2014.
Since the introduction of Help to Buy 1 in April of this year, most high street lenders have now signed up to the scheme offering rates at around 3% with fees around the £1000 mark for mortgages up to 75% LTV.
The government’s decision to move the second phase of Help to Buy forward by three months has only seen Halifax and NatWest come out with mortgage products, with the majority of the others choosing to wait until January.
As a result, Henry Knight, managing director of Springtide Capital, believes that borrowers would be wise to wait until early next year to take advantage of Help to Buy 2, once the lenders have become more competitive with their offerings.
Knight said: “Help to Buy is still in its early stages with only two of the major high street banks announcing their immediate commitment to participate.
“It is my view that the best rates on the market won’t be available until the scheme has been around for a few months with more lenders signed up.
“The post New Year period is traditionally a busy time, which is why we are expecting to see rates down to between 4 and 4.5% in January 2014 as competition for Help to Buy borrowers really heats up.”