A mortgage broker has called on the Labour government to consolidate its first-time buyer support schemes into a cohesive strategy ahead of next week’s party conference.
Sarah Thompson, group financial services director at Mortgage Scout, part of LRG, said that while progress had been made on individual measures, the schemes were not yet functioning as an integrated system.
Thompson referenced recent changes to mortgage lending rules, the permanent Mortgage Guarantee Scheme, and a proposed First-Time Buyer ISA currently under government consideration.
“Our wish for the Labour Party Conference is for a clear strategy that joins up the different stages of becoming a first-time buyer,” Thompson said.
Regional variations and deposit requirements
Thompson suggested that the ISA’s final design should reflect market conditions once a saver enters the housing market. Any property price limit should account for regional differences and adjust with market movements, she said.
The support offered needs to make a meaningful contribution towards the deposit buyers require, she added.
Thompson explained that buyers who had saved consistently and could sustain their housing costs should have a realistic route to a mortgage, while responsible lending standards continued to protect borrowers.
She said success should not be measured by the number of first-time buyer initiatives, but rather by how many people completed the journey from saving to receiving their keys.
Market perception versus reality
The comments follow research by Lloyds suggesting that almost three out of five first-time buyers believe existing debt will block their mortgage approval, and more than a third think a 20% deposit is essential.
Propertymark’s Ian Harris has stated that affordability, rather than misunderstanding, is what is actually keeping first-time buyers out of the market.
The issue of transaction bottlenecks continues to affect buyers attempting to enter the market, while industry professionals are increasingly examining which aspects of the property transaction process require human expertise versus technological solutions.
The call for policy integration comes as the government faces pressure to address housing affordability challenges affecting prospective homeowners across the UK.
