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Article: Government’S Bid To Boost First-Time Buyers (And Tory Voters) ‘Not Working’

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Some eye-opening stats here re HTB uptake or lack of (equalling to one typical month's sales) and the fact that there have been 15, yes 15, schemes to 'help' FTBs.

Face palm at the conclusion...

Governments bid to boost first-time buyers (and Tory voters) not working

First-time buyers are 2.2m behind where they should be given demographic trends despite significant government investment in home ownership.

A new report from the Intermediary Mortgage Lenders Association suggests that interventions in the housing market are missing the mark.

However, for political reasons, schemes such as Help to Buy ISA are likely to remain priorities for the new government in the post-Brexit political environment.

The report finds that government investment in the 15 different schemes currently on offer, is yet to have the desired effect of raising home ownership levels.

However, says the report, the schemes are not just about boosting home ownership but increasing the demographic that has traditionally voted for the Conservatives.

At the 2015 General Election, 46% of outright owners and 39% of mortgaged home owners voted Conservative against 28% of private tenants and 18% of social tenants, meaning home owners remain a vital demographic for the Conservatives.

This approach of extending support to help first timers get on the property ladder is partly being funded by the Conservatives second major intervention in the housing market, the introduction of the Stamp Duty surcharge on buy-to-let and second home purchases.

The Exchequer is set to raise around £1.7bn a year from the surcharge, which will help offset the annual investment in home ownership of some £6.6bn

The report says that so far some 90,000 new home sales have been made under the Help to Buy equity loan, NewBuy and FirstBuy schemes and a further 74,000 mortgages have been completed with the support of the Help to Buy mortgage guarantee scheme.

Nevertheless, it says the Government has failed to reverse the decline in home ownership.

Peter Williams, IMLA executive director, said: This is partly because saving for a deposit and accessing high loan to value mortgages remain on-going challenges for first-time buyers.

Mortgage repayments are cheaper than ever but many first timers simply dont qualify for a mortgage as they cant stump up the starting sum.

He said the Government has moved from an overall focus on supply regardless of tenure to supply built around home ownership.

He said this risks making a bad situation worse and the latest move to control the rental market by taxing landlords harder is an own goal by the Government.

It is likely these costs will simply be passed onto tenants as landlords look for other ways to maintain their profits, making the challenge of saving for a deposit an even harder struggle and it will reduce the flow of investment into new homes for rent, said Williams.

There is a longer-term risk too that it has created a more volatile political environment in the housing market which may impact on owners and investors. The current political attitudes to the private rental sector are ill-focused and short-sighted.

The IMLA report argues that a more effective way to stimulate home ownership would be a refocus on the rules surrounding mortgage availability.

http://www.propertyindustryeye.com/governments-bid-to-boost-first-time-buyers-and-tory-voters-not-working/

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"The IMLA report argues that a more effective way to stimulate home ownership would be a refocus on the rules surrounding mortgage availability."

So what they are suggesting is to go back to lending large sums of freshly printed money to people who can't afford to pay back the loans? Haven't we done that before?

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The report finds that government investment in the 15 different schemes currently on offer, is yet to have the desired effect of raising home ownership levels.

Yeah. It shuffled monies around the city and their pals but didn't trickle down.

How is that a surprise?

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"The IMLA report argues that a more effective way to stimulate home ownership would be a refocus on the rules surrounding mortgage availability."

So what they are suggesting is to go back to lending large sums of freshly printed money to people who can't afford to pay back the loans? Haven't we done that before?

"Lenders need to get in the habit of looking the other way more often, just like they did in the late 90s and 2000s".

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Some eye-opening stats here re HTB uptake or lack of (equalling to one typical month's sales) and the fact that there have been 15, yes 15, schemes to 'help' FTBs.

Face palm at the conclusion...

http://www.propertyindustryeye.com/governments-bid-to-boost-first-time-buyers-and-tory-voters-not-working/

There have been 0 schemes to help ftbers

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With downward IR forecast, lenders will try increasing sales volume to compensate. Also, more FTBs needed to join the pyramid bottom.

Edited by Fairyland

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The IMLA report argues that a more effective way to stimulate home ownership would be a refocus on the rules surrounding mortgage availability.

Good idea. I say remove all the rules. Let the banks do whatever they want and give them the nod to lend out as much as they can to whoever they can. Especially the youngsters.

The country is heading for a brick wall but it's taking forever to actually crash. At this point may as well say ****** it and floor the accelerator.

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Good idea. I say remove all the rules. Let the banks do whatever they want and give them the nod to lend out as much as they can to whoever they can. Especially the youngsters.

The country is heading for a brick wall but it's taking forever to actually crash. At this point may as well say ****** it and floor the accelerator.

You could sum up the government's purpose is to simply delay the inevitable crash by as long as possible. Forget a truly clear growth path and aspirational thinking - this is all about managing the decline towards a massive crash.

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There have been 0 schemes to help ftbers

Discount Market Sale scheme offers shared-ownership flats with no rental costs in Zone 2

The innovative Discount Market Sale programme is now being used to sell flats at sought-after Chelsea Creek and Fulham Reach, enabling first-time buyers to buy a proportion of a property - paying a monthly service charge but no rental costs. A rare opportunity has come up for first-time buyers to pick up starter homes for about £200,000 at two of London’s smartest developments this summer under the Discount Market Sale programme.

The scheme is a little-known but very budget-friendly housing option for buyers priced out of the mainstream market.

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Good idea. I say remove all the rules. Let the banks do whatever they want and give them the nod to lend out as much as they can to whoever they can. Especially the youngsters.

The country is heading for a brick wall but it's taking forever to actually crash. At this point may as well say ****** it and floor the accelerator.

The problem with that is that when they fail someone feels the need to bail them out.

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With downward IR forecast, lenders will try increasing sales volume to compensate. Also, more FTBs needed to join the pyramid bottom.

Lower IRs does not equate to lower mortgage rates.

FLS equates to lower mortgage rates.

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The problem with that is that when they fail someone feels the need to bail them out.

What do yuo think HTB is....they already have their promise....why do you think they've pushed u[p prices to insane prices again/

NR 120% mortgages = 2016 90% mortgages.

Static wages.

How do they think this will end.

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