Government Try To Stop Death of the Housing Market
The average first time buyer in the UK would require a huge £31,000 deposit to step onto the property ladder. The situation which threatens to stop the housing market operating was highlighted the Council of Mortgage Lenders.
The government show signs of frustration as Housing minister Grant Shapps explains to a delegation of representatives including Council of Mortgage Lenders, the Building Societies Association and the National Housing Federation, attended the meeting.
Mr Shapps : “There are 1.4m households who aspire to own a home but are simply unable to do so because of house prices and mortgage availability. We want to do more to help aspiring first-time buyers. This cannot be achieved simply by top-down diktats from government; there will need to be a unified effort and creative solutions from across the board to make sure we do not lock young people out of the housing market.”
The housing minister has called on the FSA and the mortgage industry to step up efforts to help first-time buyers on to the property ladder.
Private House Sales website The Little House Company representative Jane Marr
“ Without first time buyers available this will lead to stagnation and the death of the UK housing market. It is time the banks were forced to introduce new products that will help first time buyers”
They discussed the main barriers and scale of the problems facing first-time buyers and looked at the possibility of creating new mortgage products, schemes to help buyers and local approaches to increasing shared ownership or equity loans.
According to the latest figures released by the CML (for Q3 2010), the average first time buyer will need to save almost a full year’s salary (£31,500) to raise enough deposit for a loan. This represents 94% of the average income of those buyers who have purchased first homes and is a significant jump on pre credit crunch statistics. In Q1 2007, for example, the average deposit was £12,700, representing just 37% of annual income