Help to Buy scheme boosts housebuilding

The HBF said demand for the equity loan scheme, launched on April 1, was such that housebuilders would be able to significantly increase output.

More than 400 builders are registered for Help to Buy which helps purchasers secure a mortgage with at least a 5% deposit by granting an equity loan of up to 20%.

The HBF said on average around 500 people a week were taking advantage of the scheme.

It is good news for housebuyers, housebuilders and the government, as the need for large deposits has been a big brake on people's ability to buy.

Suppliers of constructions products, including the timber trade and joinery manufacturing sectors, also stand to benefit from increased home sales and housebuilders' rising confidence to build more homes.

The chief executives of Barratt, Persimmon and Taylor Wimpey all say Help to Buy is having a positive effect.

"Post the Budget announcement, compared with last year, we saw reservations step up 18% and visits to the Barratt website increase by around 30%," said Barratt chief executive Mark Clare. "Our production will rise to meet higher levels of demand and it's likely that our completions will be up 20% on two years ago."

Taylor Wimpey chief executive Pete Redfern said Help to Buy's success enabled it to build more homes on sites it already had open and gave more confidence about investing in future sites and infrastructure.

Housebuilders also say they are taking on more apprentices.