Just 16 first-time buyers across the district have used the Government’s Help to Buy Equity loan scheme due to a lack of homes being built.
The scheme offers a loan covering 20 per cent of the purchase price of a new-build property so buyers can secure a home with a five per cent deposit.
However, as the scheme only applies to new-build homes with a purchase price up to £600,000, Harrogate residents have been largely unable to benefit.
More than 60,000 homes have been bought using the scheme in its first 30 months, at an average price of £217,999, with 836 first-time buyers from Leeds.
Help to Buy NEYH manager Sophie Gilligan believes many Harrogate residents have not been able to use the scheme because of low building rates and high house prices.
She said: “The number of people using the Help to Buy scheme usually reflects the number of homes being built in an area.
“In Harrogate government statistics show building rates are fairly low, 120 new homes were completed during the first three quarters of the year in 2015, compared with 1,260 for the same period in Leeds, for example.
“If building rates increased we’d expect to see more people benefiting from Help to Buy. We also find the scheme is more popular on lower value properties.”
Ms Gilligan revealed 76 per cent of those using the scheme in Harrogate are first-time buyers compared with the national average of 81 per cent.
Despite the scheme’s popularity, Rebecca Burnett, cabinet member for Planning and Sustainable Transport, admitted more homes needed to be built in Harrogate for first-time buyers.
She said: “We would love for that figure to improve but we are playing out part. We are giving permission for thousands of homes to be built, enough for the next four or five years.
“However, we need developers to step up and build the houses we are approving so people can benefit from this Help to Buy scheme.
“Another problem is that people who use the scheme will be mainly looking to purchase slightly cheaper properties and we do not have enough of those being built locally.
“We are trying to address that because developers here want to build big, detached, four or five bedroom properties which are not accessible to buyers on the help to buy scheme.”
Coun Burnett explained the council were negotiating with developers to build smaller homes but admitted she was concerned with how few were being built.
She said: “I want the developers to get on with building the homes but it’s not as simple as people think because there are other factors in play.
“We have to maintain a five-year supply based on our assessed housing need and at the moment we are well above that.
“I can’t put a figure on how many houses we will pass this year because it depends on when the developers will build them but we will continue to approve suitable schemes.”