David Cameron said that the government would put a ‘mechanism in place’ to prevent existing homeowners from using the Help to Buy mortgage guarantee scheme to purchase second homes.

Help to Buy is split into two parts: the equity loan from government introduced in April this year, which is not available to second home buyers, and a mortgage indemnity guarantee scheme due to come into play next year, which should encourage mortgage lenders to offer terms to borrowers of higher loan to value mortgages at lower interest rates.

The Labour Party has spent months criticising the government over the possibility the latter part of the scheme could be accessed by wealthy individuals and existing homeowners.

Last week Cameron was questioned by Ann McKechin and failed to deny that foreign owners could take advantage of the scheme, something else he also denied yesterday.

Seema Malhotra, Labour MP for Feltham and Heston, asked Cameron:

“Last week the Prime Minister couldn’t confirm that taxpayers would not subsidise foreign buyers of property in the UK. “Can he instead clarify whether his Help to Buy scheme will see taxpayers help fund purchases of second homes and holiday cottages?”

Cameron responded: “This scheme is for people’s only home, it will have a mechanism in place to make sure that is the case. The second thing, which is important, is in order to take part in this scheme you have to have a credit record in this country. So no, it won’t do what she says it would.”

No further clarification was given, with some commentators suggesting that those with homes abroad could still be given access to the scheme and casting doubt over how easily the government’s restrictions can be enforced.