David Cameron announced a raft of measures this week to assist the beleaguered housing market in a ‘give away’ package totalling £400 million. Here’s a bullet pointed run down of the support that Government is set to provide:
- Financial support to assist developers in completing a further 16,000 new homes creating 32,000 new jobs.
- 100,000 first time buyers will benefit from Government underwritten deposit indemnities that will help bridge the gap between the 5% deposit that first time purchasers can afford and the 20% that lenders often insist on, particularly in order to access more competitive lending rates.
- Greater discounts under the Right to Buy scheme to enable more social housing tenants to purchase their own homes. The money raised from further sales will be used to build another 100,000 affordable homes.
- A £150 million plan to tackle the 700,000 empty homes in the UK and to bring them back into use.
In essence, these proposals will not completely solve a housing market that is a shadow of its 2007 self. No one is saying that the opposite is true. But it’s a start.
And if anyone thinks that it’s a good thing in any case to get back to such an overheated, high demand vs low supply situation with easy 125% mortgages that throw the caution of salary multiple criteria to the wind, then think again.
But these plans may begin to slowly warm the market back to life so that it resembles a normality that is somewhere between now and then. Just a little confidence and a little less media overkill is just what the house doctor ordered and we sincerely hope that this Governmental assistance may perhaps be the start of that.