It is expected that the new funding will assist around 135,000 more people to buy homes by 2021, bringing the total number of households across England helped by the scheme to around 360,000.
Figures have revealed that 81% of home purchases using the equity loan scheme have been made by first-time buyers, helping to increase the total number of first-time buyers by 70% between 2010 and 2016.
The Help to Buy equity loan scheme launched in April 2013 and funding has been committed until 2021.
The loan can be used to purchase new-build properties up to the value of £600,000, with a maximum equity loan of £120,000 (20%).
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In London, applicants are able to claim an equity loan up to 40% of the purchase price.
Earlier this week, the government announced that over 1 million Help to Buy: Isas have now been opened by first-time buyers, providing up to £3,000 towards the cost of a first home.
A government spokesperson said: “The new funding expands the government’s commitment to help people make their dream of owning a home a reality.
“The chancellor has been clear that support for buyers must be matched with support for building so that, over the longer term, housing becomes more affordable.
“This means land must be made available in the right places to build the homes we need.”