The Intermediary – April 2025 - Flipbook - Page 9
RESIDENTIAL
Opinion
Building continues,
but is housing still
out of reach?
R
achel Reeves
delivered her Spring
Statement recently,
at a time that,
arguably, wasn’t
ideal in the housing
sector. There were plenty of positives
discussed, although these don’t quite
meet the initial manifesto when
Labour was lobbying for power, and
the plan for growth in housing sector
wasn’t quite enough in my opinion.
The Office for Budget Responsibility
(OBR) said that housebuilding will
reach a 40-year high, with 305,000
homes being built per year by the end
of the forecast period (2030). This
would equate to 1.3 million homes
being built in the UK over the next five
years. Granted, it’s less than the 1.5
million promised, but regardless, it’s
an incredibly positive thing to hear for
the property industry.
The timing, however, wasn’t
great. Growth estimations for the
wider economy and country’s GDP
are looking lower than before, and
inflation is expected to reach around
3.7% later this year – which naturally
could have some knock-on effects
when the Bank of England considers
reductions to base rate.
Those looking to get on the ladder
might still encounter hurdles to
achieve their goal. Coupled with
Stamp Duty thresholds reducing
back down to previous levels, this is
likely to leave some first-time buyers
nervous about buying their first home.
Not only that, but this affects those
looking to simply move home, too.
Granted, the Financial Conduct
Authority (FCA) has been very vocal
in wanting to relax and simplify
mortgage requirements to increase
affordability, and we have seen a
number of lenders displaying their
compliance with this, whether
they’re able to increase income
multiples for certain loan-to-values
(LTVs), have specific options for
‘professionals’ or stress affordability
in a more relaxed manner for a longterm fixed rate.
However, what I really think we
need to see is some form of scheme,
similar to Help to Buy, in order to
give those wanting to acquire the new
homes being built some substantial
confidence and backing.
Now, I know there are private
schemes in place and many developers
look to offer some form of incentive at
present, but a universally understood
scheme would be ideal. It might not
counteract the obstacles faced entirely,
but it would at least give first-time
buyers – and those in need of upsizing
or downsizing for that maer – some
confidence, and perhaps the push they
need to start the discussion with an
adviser to work out a viable option for
them, or at least put in place a rigid
plan to get them purchase-ready.
So, although it’s exceptionally
promising to hear about such a boost
to the housing sector in the UK,
having a clear scheme in place should
be a focus for the Government, in
order to propel the housing market
forwards even further.
JONATHAN FOWLER
is founder and managing
director at Fowler Smith
Mortgages & Protection
Having a clear
scheme in place should
be a focus for the
Government, in order
to propel the housing
market forwards”
This, coupled with stronger
affordability offered by lenders – and
hopefully a continuation of more
palatable interest rates – would surely
mean all those properties being built
will also be occupied, without lastditch aempts to sell-off stagnant
stock by developers.
It must be noted that the Chancellor
of the Exchequer did also mention
an investment of £2bn in social and
affordable housing. This is always a
promising thing to see, but eventually
some of those renting via affordable
housing are likely to want to get on the
ladder – and I’d really like to see such
support offered.
With some lenders increasing loanto-values on new-build properties,
we’re seeing positive changes on
the whole.
I’d just like to see more done to
prompt further conversation, where
we as industry professionals can be
fully on board with a Government
scheme introduced, and can help
to ensure the new housing being
built is occupied by those who are
striving to own it. ●
April 2025 | The Intermediary
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