Further plans to modernise home buying have been unveiled this
week, helping more people to realise their ambitions of owning
their own home as part of the government's Plan for
Change.
The government has committed to launching a new, permanent,
comprehensive mortgage guarantee scheme that will open the door
to homeownership for more young families and hardworking
renters.
Alongside this the Economic Secretary to the Treasury has written
to the Financial Conduct Authority (FCA) following their response
to the government's call for regulators to support growth,
setting out the government's support for their proposal to review
mortgage rules. The government has made clear it wants the FCA's
review to be as ambitious and rapid as possible to help as many
people as possible to achieve the dream of owning a place of
their own.
It follows an announcement last week that the government is streamlining
and digitising the process for buying and selling
homes to help homebuyers save time and money, and
reducing the number of house sales that fall through. Fall
throughs impact one in three transactions and cost people around
£400million a year in total and currently there are delays of
almost five months in the system.
Millions of hardworking people have been locked out of home
ownership – the number of first-time buyers fell to a 10 year low
in 2023 and today's under 30s are less than half as likely to be
home owners than those at the same age in 1990.
The government's Plan for Change has clear ambitions for
delivering 1.5 million more homes and driving growth – cutting
unnecessary red tape in order to be on the side of builders and
working people who want to get on the property ladder.
City Minister said:
“For too long politicians have ducked and dodged the decisions
needed to support homeownership.
“Simplifying responsible lending rules and putting in place
a permanent mortgage guarantee scheme shows our
commitment to making the dream of owning a home a reality. I
will work closely with regulators and industry to get this done
quickly and in a way that supports as many people as possible.”
Housing Minister said:
“The affordability challenges facing first-time buyers mean that
we now have a generation locked out of homeownership . This
government is determined to change that, ensuring that young
families and hardworking renters can buy a home of their own.”
New details on the new Mortgage Guarantee Scheme will be
announced in due course and will replace the existing Mortgage
Guarantee Scheme, which was due to expire this year. By making
the Mortgage Guarantee Scheme permanent and comprehensive, banks
and building societies will have long-term confidence to continue
offering low-deposit mortgages.
Many working people continue to find it extremely difficult to
secure a deposit, meaning for too many the dream of home
ownership has depended on access to the ‘Bank of Mum and Dad',
leaving those without that option often trapped in a cycle of
renting without a way out.
This commitment to a new Mortgage Guarantee Scheme means
first-time buyers, including young families, will be able to take
that crucial first step onto the property ladder, with only a
small deposit, tackling one of the biggest barriers to
homeownership and giving them the stability they need to plan for
the future.
