Homebuyers pile into purchase scheme

About 4,000 buyers have seized on the Government's Help To Buy initiative, introduced in the last Budget, to snap up new homes in the past two months alone, the Home Builders Federation said yesterday.

But the roaring start for the Chancellor's efforts to spur on the market came as lender Halifax reported a fourth-successive monthly rise in house prices, which were up by 0.4 per cent in May.

The equity loan part of the scheme allows buyers to get on the ladder with a 5 per cent deposit, although a wider programme of mortgage guarantees begins next year.

The surge in interest has fuelled fears of a house-price bubble, but the industry insists it can boost output to meet demand without prices going through the roof.