Labour is launching a new Freedom to Buy scheme to get 80,000 young people on the housing ladder, over the next five years.
This would be a permanent mortgage guarantee scheme, with the state acting as guarantor for prospective homeowners who struggle to save for a large deposit. The party claims this would be “more comprehensive” than the existing government scheme that is set to expire in June 2025, offering instead a permanent product for first-time buyers and families looking to get on the ladder. This would run beyond 2025.
This will establish insured mortgages as an integral part of the market that lenders and borrowers can confidently navigate. A statement from he party says: “A Labour government will work with lenders and industry on increasing uptake of the scheme and ensure front line mortgage advisors are aware of the product and can confidently offer it prospective buyers who want to get on the ladder.”
Labour is also today reiterating its existing broad-brush housing policies but, interestingly, has not put rental reform as a key objective. Instead it states it will prioritise:
- Planning reform to build 1.5 million homes: in the long-term best way to help young people is to build more homes. “We will reintroduce housing targets, build on disused grey belt land, fast track permissions on brownfield and build the next generation of new towns”;
- First dibs: “work with developers to give local people ‘first dibs’ on new developments, ending the farce of entire developments sold off to international investors before local people get a look in.”
- Tax foreign buyers to fund planning officers: “tax foreign buyers pricing out young people to fund new planning officers to approve homes next generation needs”;
- Reform compulsory purchase rules to get homes built: “reform compulsory purchase rules to stop speculators frustrating housebuilding and squeezing value from infrastructure and affordable housing. Where necessary we will not hesitate to use reformed compulsory purchase orders to support housebuilding and infrastructure delivery.”
The party claims that under the Tories, planning permissions for new homes have plummeted to record lows, whilst housebuilding is set to crater. It also claims that councils are already using Tory planning changes to overturn applications for new homes they had originally approved.
Sir Kier Starmer comments: “My parents’ home gave them security and was a foundation for our family. As Prime Minister, I will turn the dream of owning a home into a reality. Our changed Labour Party will be on the side of the builders not the blockers, to get Britain building again.
“My Labour Government will help first-time buyers onto the ladder with a new Freedom to Buy scheme for those without a large deposit, and by giving them first dibs on new developments.
“Labour backs hard work and ambition, and will clear the way for the opportunity to own a home. It’s time to stop the chaos, turn the page, and rebuild Britain.”
And Angela Rayner, Labour Deputy Leader and Shadow Housing Secretary, adds: “Labour’s new Freedom to Buy scheme will deliver for working people across the country. We will deliver more action on housing in the first year of a Labour Government than this crumbling Conservative government has managed in over a decade.
“Labour’s plan would get Britain building again with a new scheme to help young people get a mortgage and with a housing recovery plan, creating a generation of new towns and unlocking economic growth across Britain.
"Labour is the party of homeownership, and the only Party serious about building the homes Britain needs. We will deliver the change needed and end the Tory chaos.”
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Another scheme that will underpin housing market and falsely inflate prices further still. I totally understand the desire for people to own their property, as this provides much more stability for them and their families. However, it my belief that these schemes potentially fuel the market which will be more detrimental when property values increase beyond inflation.
There will of course be people that disagree with this theory, but having worked in this industry since 1984 I can recall over the decades various government schemes that greatly influenced house prices both up & then down. Furthermore, it is mortgage providers that are complicit with this deception of "helping" people by providing loans that are often beyond affordability when the economic pattern shifts in one direction.
It was so called MIRAS (Mortgage Interest Relief AT Source) where the government provided around 10 months for couples to buy a property and retain double relief, where in that time there was an utter frenzied marketplace that increased property prices way beyond any normal level and the inevitable crash in the late 80's creating utter misery for homeowners, where many lost them due to being repossessed.
Through the decades other schemes were devised by government to keep the market from collapsing in terms of property value, where if they just let things take there naturally course property prices would not be anywhere near where they are today. Therefore, the generations coming through would be able to afford to get onto the ladder at an appropriate age.
Its doesn't take a genius to work out that a 15% - 20% hike in property value in one given year is not going to have a profound effect.
By all means fellow readers, do let me know if I speak with forked tongue.
80,000?? Its better than none, but out of 5 million private tenants thats hardly going to ease any pressure in the PRS when more properties will be lost than that in a 12 month period.
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