Close to four million ‘resentful renters’ locked out of buying a house due to spiralling mortgage costs
CLOSE to four million “resentful renters” have been locked out of buying a house due to spiralling mortgage costs, a report reveals.
Tough new rules for home buying loans came in after the financial crash in 2008 to stop defaults.
A report by the Centre for Policy Studies (CPS) has found stringent bank stress tests on potential buyers mean they need to prove they can afford to pay an average of £1,075 a month in interest in case rates go up.
That’s while the average monthly mortgage payment is just £633.
At the same time, the average deposit paid by first-time buyers has tripled, from five per cent to 15 per cent.
Together, 3.6 million people under 65, who’d have been homeowners before rule changes, have been locked out.
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Entrepreneur Graham Edwards, who wrote the CPS report, has called for the Government to stand by new fixed-rate mortgages so that owners know what they will be paying for the next 25 years.
It would also require a house building boom.
The CPS’s Robert Colvile said: “If we get it right, we can give millions more people the gift of home ownership.”
The Sun says
BORIS Johnson might have a stonking majority, but his party has a lethal young person problem.
Alarming data reveals that, if the vote were confined to 18 to 24-year-olds, Comrade Corbyn’s Labour would have hoovered up 544 seats in the election.
To win back the lost generation, the PM must turn his mind immediately to fixing the hideous housing crisis.
Of course, the priority must be a mega building spree. But there are quick fixes which would go a long way too.
Despite house price rises, a new report from a respected think-tank shows that home ownership would still be as affordable for today’s first-time buyers as in 2009 if the rules on 95 per cent mortgages had not been made so tight they now exclude so many borrowers.
It means that if Boris gave 3.6million resentful renters a helping hand getting a deposit, he could single-handedly unlock the housing market to a generation of aspirational hard grafters.
It would be tough: the 95 per cent mortgage was abandoned because owners kept defaulting.
But new long-term fixed rate deals could solve that. And we have no doubt the Tories would reap the rewards at the ballot box.
Young Corbynistas fancy themselves as socialists now. But put affordable homes within their grasp and they’d soon see on which side their bread is buttered.
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