Yesterday George Osborne officially announced the Budget for the next year, and as expected he discussed the importance of investing in and creating new housing. In order to improve the housing market and help get more families on the property ladder or move into second homes, the government have launched two new schemes under the ‘Help to Buy’ plans. The first scheme will be targeting would-be buyers, as the government is promising to give those that save up a 5% deposit a 20% interest free loan towards buying a property. The second scheme is aimed at encouraging lenders to give mortgages to those with small deposits in order to boost the housing sector.
However, not everyone is convinced that the new Help to Buy schemes will work, and some have even stated that Mr Osborne has missed the point altogether when it comes to solving Britain’s housing crisis. For example, Jonathan Moore, managing director of Easyroommate.co.uk, said: “The Help to Buy scheme will go some way towards releasing some of would-be buyers from the rental sector but this policy in isolation isn’t enough to solve the housing problem. There is still a huge supply and demand imbalance in the rental market and this needs to be addressed. Boosting house-building in one part is the answer but the Chancellor has missed a golden opportunity to unlock accommodation sat idle across the country.”
Landlords with unoccupied property were not mentioned in the Budget announcement, however many local councils have already called for landlords to try and reduce void periods as much as possible and not rely on landlord insurance policies or unoccupied property insurance instead of finding tenants. Some members of the housing industry have been more positive about the Chancellor’s plans, yet still are concerned that it may not work out due to lack of enthusiasm, such as Donna Houguez, Market Analyst for Quick Move Now.
Ms Houguez said: “I think it is admirable that the Government is making this statement of support to the property market, and it clearly hopes that creating movement in this one sticky area will, in turn, stimulate the layers above. However, I am concerned that take up of past government schemes, from lenders, house builders and buyers alike, has been pitifully low and no rationale has been demonstrated to explain why ‘Help to Buy’ is likely to be any different.”