The London help-to-buy scheme, launched on Monday, will enable homebuyers there to borrow 40% of the cost of a new property from the government.
Lenders are offering mortgages on such homes at well below the going rate for existing homes due to the government’s absorption of a significant part of the risk. The scheme is in addition to the existing help-to-buy offer, which provides a 20% interest-free loan for a five-year period.
Barclays analyst Jon Bell said the bank expected significant demand for properties at sub-£600k price points.
