Second phase of Help to Buy 'good news for solicitors'

The second phase of the Help to Buy scheme, which opened for applications today, is "good news for solicitors", a leading conveyancer has said.

Eddie Goldsmith, chairman of the Conveyancing Association, said the arrival of the second instalment of Help to Buy was an opportunity for firms to review their fees, given that the work was more complicated than ordinary conveyancing transactions.

Unlike the first phase of the scheme, which applies only to new build properties, the second applies to all homes worth up to £600,000.

Lenders wishing to offer loans to buyers with deposits of only five per cent can get a government guarantee to cover a further 15 per cent of the price. At the moment only RBS and Lloyds are signed up for the scheme, but other lenders are expected to join.

Goldsmith said the Help to Buy pack for solicitors, produced by the homes and communities agency, was 60 pages long.

Earlier this summer he said some buyers using the first phase of the government's Help to Buy scheme had been forced to change solicitors half way through because their conveyancer "lacked sufficient knowledge".

Goldsmith said the second phase was "a big, big initiative" and there was lots of appetite for it.

"Conveyancing Association members are recruiting. The problem is how to get the right quality staff. There is a dearth of really good staff. It's a nice problem to have, but it's still a problem."

He added that the market was still depressed compared to the situation before the slump and conveyancers would be more cautious about expanding than before.

"Lenders are reviewing their books and people are more careful than ever to meet their requirements. Firms can't just take on a lot of foot soldiers."

However, Michael Loveridge, sole practitioner in Clitheroe, Lancashire, described the existing Help to Buy scheme as "ridiculous" and said that all it had achieved was to transfer money from taxpayers to construction companies.

He went on: "All that's happened is that the builders have put up their prices. Shares in construction companies have rocketed."

Loveridge said the second phase of Help to Buy would only drive up prices further.

"Why do we want higher prices? People can't afford them as it is. It seems like complete lunacy to me."