Who needs help to buy?

Pretty much everyone it seems, though perhaps not in the way you’d expect.  A bit over a month on from the official launch of Help To Buy 2: Mortgage Guarantee (HTB2 for short) we still only have two lenders - Halifax and Natwest/RBS - offering products under the scheme, though a number of others have sworn faithfully to join in soon. But while the “official” participation has been very limited, there’s been a lot more activity indirectly related. The first clue was when Natwest launched their labelled HTB2 products at 95% loan to value: at the same time they cut some other low-deposit rates quite by more than 0.60%, which is a huge amount. Now I can’t prove it but I strongly suspect those loans will also get bundled into the HTB2 guarantee when it becomes available in January; it’s just that Natwest didn’t feel the need to label them up. Since then we’ve seen a whole load of improvements in low-deposit mortgages. Everything from HSBC promising to match select high street competitors to Hinckley & Rugby launching their first 95% deal, well I won’t say ever but certainly for a jolly long time. Quite possibly other lenders beginning with H have done similar things. In the wider alphabet, Woolwich launched new deals at 90% LTV; Yorkshire BS and their plethora of sub-brands cut same; Nottingham improved rates at 90% and 80%; Coventry came very strongly across the board but most notably at 80% and 85%; Nationwide hacked 0.30% out of their 90% deals; tiny Teachers BS – one of few already offering 95% products – reduced the rate by 0.50%, while Newcastle cut their 95% rate by 0.36% AND scrapped the early repayment charges! Other lenders beginning with N are available. Now we have news that Yorkshire BS today launched a thirty-six new mortgages at 95% LTV. THIRTY-SIX! Actually there are eight products, the balance being the same products with the word Yorkshire crossed out and Chelsea/Barnsley/Norwich & Peterborough/Accord written on in crayon ((c) Monty Python). Joking aside, this is a major lending group coming into the 95% market and a very welcome one at that: it’ll surely put pressure on others to come forward too. None of these moves are directly linked to HTB2, and the YBS press release specifically states they’re not using it. In similar vein, Hanley Economic – a high LTV stalwart - was on a recent press release by private insurer Genworth saying, essentially, they see no need to join in the HTB2 party either.  So there’s no need for help to buy then? Well there’s the thing. While you’d be forgiven for thinking lenders are going out of their way to show they don’t need (or want) the government scheme, it’s doubtful they’d have done all this if said government scheme weren’t there to begin with.