A helping hand from the Welsh government

Help to Buy - Wales allows eligible purchasers to buy new-build homes with assistance from the Welsh Government in the form of a shared equity loan.

What does this mean in practice?

Help to Buy - Wales shared equity loans are available to both first-time buyers and home movers wishing to purchase new-build homes worth up to £300,000.

With Help to Buy - Wales:

  • buyers won't be able to sub-let their home.
  • buyers need to contribute a deposit equal to 5% of the property price.
  • the Welsh Government (through Help to Buy (Wales) Ltd) will fund a shared equity loan for up to 20% of the purchase price.
  • buyers will then need to secure a mortgage to cover the remaining balance.

Example Undertaking

Help to Buy - Wales Calculator

Purchase price (£)
Enter the price you are actually paying for the property
Cash deposit (£)
You will need to contribute at least 5% of the property price as a deposit
Shared equity loan (£)
The Welsh Government will give you a shared equity loan for up to 20% of the price
Your mortgage (£)
You will need a mortgage of up to 75% to cover the rest

If in the future the home in the table above sold for £210,000 the buyer would get £168,000 (80%, based on their mortgage and the cash deposit) and pay back £42,000 on the shared equity loan (20%).

The buyer will pay off their mortgage using the proceeds of the sale and will then repay the Help to Buy - Wales shared equity loan.

Are there any fees attached to the shared equity loan?

From the time a buyer receives the shared equity loan they will be charged a small administration fee of £1 per month.

Then, in the 6th year, they'll be charged interest of 1.75% per annum of the original shared equity loan amount. After this, the interest will increase every year. This increase is worked out by using the Retail Prices Index plus 1%.

All buyers will be contacted before the shared equity loan interest starts and they'll also be sent a statement about their shared equity loan each year.

The fees do not count towards paying back the shared equity loan.