The Government’s pledges to help first time buyers are insufficient
Edward Freeman says that the mid term statement shows willing but does not contain enough concrete promises
January 8, 2013
The coalition government has released it’s mid term statement reviewing the last two and a half years and looking forward to what it intends to do next. One area which was conspicuously free of concrete proposals was housing. There are four pledges – to bring more empty homes into use; to create a debt guarantee scheme to generate more affordable homes; removing restrictions forcing developers to honour their commitments to build affordable homes; extending FirstBuy and continuing to back NewBuy to ensure more first time buyers can get on the ladder.
The UK is in the midst of a major housing crisis which will not be ameliorated by such half-hearted, recycled measures that do almost nothing about the increasing unaffordability of British homes. The elephant in the room which the government seems determined to not look in the eye is the lack of supply. Construction of new homes has remained fairly stable over the last few years at just over 100,000 per year. Currently the UK is seeing the formation of 230,000 new households every year.
This situation is unsustainable and needs to be dealt with quickly and decisively. The Government’s pledges show the right intent. Making it easier for those who can afford a mortgage to raise a deposit is important. However, in the long term this is just adding more wallpaper to a house built on sand.