Help to Buy has kept us locked!

Desperate to move: young parents Jessica Dawson and Charles Malcolm with their son Hudson, 18 months

Charles Malcolm and his partner Jessica Dawson were desperate to buy a house from their parents in Cove Bay, Aberdeen.

The young couple had tried to scrape a deposit by saving on luxury and borrowed money from Jessica's family.

In the end, it was the government's Help To Buy flagship that gave them the financial support they needed to get a £ 205,000 two-bedroom newly built flat three kilometers from the city center.

But only three years later the young couple – now with a son of 18 months, Hudson – are trapped.

Desperate to move: young parents Jessica Dawson and Charles Malcolm with their son Hudson, 18 months

Desperate to move: young parents Jessica Dawson and Charles Malcolm with their son Hudson, 18 months

With baby toys and clothes filling every room in the flat, Charles, 25 and Jessica, 23, are desperate for a bigger house.

But when they had valued their possessions at the end of last year, they were told that it was worth only £ 175,000 – £ 30,000 less than they had paid.

It means that if they sell their house, they lose the £ 10,000 deposit that they have spared so hard and need to find another £ 8,000 to repay their mortgage lender.

Charles and Jessica are now worried that it may take years before they can afford to move to a larger building.

Last week, Money Mail unveiled how experts have raised serious concerns that project developers are pushing the price of new homes sold through Help To Buy.

Three separate insiders from the industry have informed Money Mail that these new properties will be overvalued by no less than 15%.

The experts say that companies are trying to compromise because they know that buyers who use Help To Buy can afford to buy more expensive homes than they could without the scheme.

The warnings come at the moment the government prepares to start a discussion of Help To Buy, so that it could go beyond the originally planned end date in 2021.

It is thought that ministers can also limit the number of starters or lower servers, assuming that it is mainly richer households that use the plan to buy more expensive properties.

Experts say that companies try to compromise because they know that buyers who use Help To Buy can afford to buy more expensive homes than they could without the scheme.

Experts say that companies try to compromise because they know that buyers who use Help To Buy can afford to buy more expensive homes than they could without the scheme.

Experts say that companies try to compromise because they know that buyers who use Help To Buy can afford to buy more expensive homes than they could without the scheme.

Under Help To Buy, which was launched in 2013, home buyers can get an extra loan of 20 percent from the government – or 40 percent if they buy in London.

This comes on top of a mortgage that is obtained from a bank or construction company and means that they only have to find a down payment of 5 percent.

In the case of Charles and Jessica they could not have paid the £ 205,000 apartment without this help.

Through Help to buy, they received a £ 41,000 loan from the government, which – along with their £ 10,250 deposit – meant that they could get a mortgage of £ 153,750 to cover the rest.

The idea was that they would stay in the flat for a few years while saving for a larger deposit. When they sold the property, they could use it, plus the profits they had made by rising house prices, to buy a new house.

But since they bought their apartment in September 2015, the market value is 15 pc. Declined to £ 175,000.

By comparison, other flats in Aberdeen have risen by 1.2 percent on average over the past five years, according to online broker Zoopla.

If Charles and Jessica sell their apartment for just £ 175,000, they would have to pay back £ 35,000 to the government.

They would not have to pay back the full £ 41,000 because the loan is a percentage of the value of the property.

After repaying £ 35,000, this would leave the couple with only £ 140,000. Although they have paid off their mortgage, the remaining balance would still be £ 148,000.

This means that if they sell, they have to find £ 8,000 to cover the deficit – money they simply do not have.

They have also lost their original deposit of £ 10,000.

The warnings come at the moment the government prepares to start a discussion of Help To Buy, which can be extended beyond the original planned end date in 2021

The warnings come at the moment the government prepares to start a discussion of Help To Buy, which can be extended beyond the original planned end date in 2021

The warnings come at the moment the government prepares to start a discussion of Help To Buy, which can be extended beyond the original planned end date in 2021

Charles, who works as a coordinator for a drilling company from the North Sea, says: "We knew that the flat was quite pricey when we bought it, compared to other houses in the neighborhood, but we assumed that this was a brand new property. Help to buy was our only option and so we just went for it.

Now we really need more space for our growing family, but we do not have the money to repay our mortgage lender. & # 39;

He adds: & # 39; We still pay Jessica's family back for the money we have borrowed for our down payment. & # 39;

Paula Higgins, the chief executive of the consumer organization HomeOwners Alliance, says first-time buyers should do their research when they want to buy a house to prevent them from falling into overly expensive properties and hidden developers' tricks to buy your homes.

She says: "New buyers have to go to the scheme with open eyes and wonder whether the price makes sense – and negotiate with the developer or run away if the price seems too high.

Help to buy can be a great way for starters to get on the house ladder, but only because a new house carries the Help To Buy badge does not mean that its quality or value is guaranteed. & # 39;

A spokesperson for project developer Scotia Homes, who sold the couple, says: & # 39; The economy in the northeast of Scotland has a focus on the oil and gas sector, which has been particularly challenging in recent years.

& # 39; The resulting impact on real estate was significant, with a fall in house prices to 20 percent.

This autumn, from a peak in 2014 to the low point in 2017, has passed all price categories and has affected both second-hand and new-build objects. & # 39;

s.partington@dailymail.co.uk

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