Key Housing Policy Initiatives From PM
The speech in Lancashire yesterday was billed as Johnson’s attempt to rescue confidence in his premiership with some key housing policy initiatives.
Yesterday Boris Johnson attempted to re-set his premiership after 141 Conservative MPs voted against him in this week’s dramatic confidence vote with a speech setting out several new major key housing policy initiatives.
During a trademark wide-ranging speech spattered with historical allusions, the Prime Minister revealed a review of the mortgage market to facilitate more low-deposit mortgages for first time buyers; extending Right to Buy into the housing association sector; making a brief mention of the Renters’ Reform Act; and finishing the leasehold reform process.
But his most significant announcement was to reveal that the government’s £30 billion Housing Support budget, which is spent on paying for tenants on benefits to live in housing associations or private rented accommodation, will instead be directed towards helping them secure a home loan and buy their first property.
Dubbed the ‘benefits to bricks’ policy, it will see rules changed on welfare so that the 1.5 million working people who are in receipt of housing benefits and want to buy their first home will be given a new choice – spend their benefit on rent as now or put it towards a first-ever mortgage.
“Doing so removes a significant barrier that currently prevents hundreds of thousands of families from buying their own home,” said Boris Johnson.
“As the Prime Minister has said, prospective first-time buyers have been aiming at a moving target with rising housing prices, interest rate hikes and the cost-of-living crisis taking its toll on their ability to be able to get a foot on the property ladder,” says CEO Iain McKenzie (pictured).
“Many are already paying rent that would equal their mortgage repayments; however, many have been hindered by deposit requirements and meeting mortgage approval criteria.”
‘In theory, I understand the logic behind trying to reduce the benefits bill,” says the north London agent (pictured).
“But this is predicated on house prices continuing to rise rapidly, which is no comfort for those not on the ladder who are aspiring to get on there at some point soon.
‘The other point is that it relies on lenders taking on borrowers who are on benefits, as they are often the ones who are struggling not just with raising deposits but making repayments.
“They are often on lower salaries and struggling to make ends meet, so would lenders take them on from a commercial point of view without some sort of guarantee from the government that they will meet their repayments?
“I think this is bluff and bluster; as is often the case, what we need is a lot more detail.”
Referring to Johnson’s mortgage review pans, the portal’s Director of Property Science, Tim Bannister (pictured), says: “The review will take time and so any solution won’t help in the short-term, so as the cost of living increases more people are likely to look further afield at cheaper areas to get on the ladder.”