People using Help to Buy are paying almost 10% more than those buying newly built homes without the scheme.
Buyers using the scheme paid an average of £278,00 over the past year compared with £257,000 for those who did not. This is in addition to a 16% premium for new homes over equivalent older homes.
The figures, from more than 70,000 first-time buyers, will raise fears that taxpayers’ cash is creating a bubble that risks leaving a generation of homeowners stuck in negative equity. Help to Buy offers first-time buyers with a 5% deposit an interest-free loan for five years of up to 20% of the purchase price, or 40% in London.