Can I sell my Help to Buy home?

Yes, It is possible to sell your Help to Buy home, but there are a couple of extra things to think about if you decide to make the move.

Just like buying a property for the first time, selling a house can be daunting if you haven’t been through the process before - which is very likely if you’re selling your Help to Buy home. The best way to begin is preparation. But, as a fairly new and evolving scheme, knowing what the rules and requirements for your Help to Buy property actually are can be confusing. We’ve compiled this short guide to help you get to grips with the process and put you in the best position for a smooth sale.

What is the Help to Buy scheme?

The Help to Buy: Equity Loan is one of a number of government schemes designed to make it easier for first time buyers to get a foot on the ladder. With one of these equity loans, the government lends you up to 20% (40% in London) of the cost your home. This means you can purchase a house with a smaller deposit, and take out a smaller mortgage.

The property you purchase must be a new build, and there are regional price caps (up to £600,000) for the total cost of the property you intend to purchase. Because the loan is designed to encourage home ownership, you are not allowed to buy the property to let out, if you wish to take advantage of the loan. But, if you agree to these terms you won’t be charged loan fees on the government loan for the first 5 years of its term.

How to sell a Help to Buy property

You can sell your Help to Buy home in the same way as other properties - with an estate agent on the open market. However, you will have to take into account both the government loan and your mortgage.

Your Help to Buy loan must be repaid after 25 years, or at the same time as you sell your home. You may have chosen to make some repayments on the loan prior to selling. In this case, you will only need to pay the remainder of the loan from the proceeds of your home sale. If you have not chosen to make any payments, you will need to repay the full amount.

Once you've received an offer on your property you'll need to arrange a valuation with a licensed surveyor. This information should be sent to the administrative body that deals with Help to Buy - Target. Once they have received this, they will let you know how much you owe and what happens next.

In the majority of cases, you will use the money remaining from the final sales price to pay off your mortgage. Your solicitor will do this for you.

In some cases you may be able to transfer your mortgage deal to your next property. This is called ‘porting’. However, if you’ve got a mortgage that’s specifically designed for Help to Buy properties, it’s unlikely to be portable. Some lenders might refund any early repayment charges if you take out another mortgage with them for your new house.

Either way, if you need a mortgage for your next home you will need to make a separate application.

You'll find more info about mortgages, and moving house, in our handy guide.

Other things to consider:

In some cases, it’s possible that the value of your Help to Buy Home has reduced in value. What does this mean for selling?

The Help to Buy Equity Loan only requires you to pay back the relative percentage of your home's market value when you sell. For example, if you received a 40% loan, you would pay 40% of your property's value at the time of selling back - even if the value has changed. If your house has dropped in value, this means you will pay back less. If your house has increased in value you will pay back more.

Having the support of an excellent estate agent will make selling your Help to Buy home that little bit easier. A top performing agent will have lots of experience helping first time sellers through their sales journey, and can provide all the information you need to take that next step on the property ladder. Compare the best estate agents in your area here.

For more information and advice on how to sell your home, check out our handy guide here.