The Intermediary – August 2025 - Flipbook - Page 24
RESIDENTIAL
Opinion
Reforms must work
for first-time buyers
and savers alike
I
n today’s market, brokers are
on the front line of helping
first-time buyers navigate
a path to homeownership
– a path increasingly
obstructed by rising house
prices, deposit shortfalls, and
affordability challenges. That’s why
the Chancellor’s Mansion House
speech and subsequent commitment
to a permanent Government-backed
Mortgage Guarantee Scheme is a
welcome step forward, providing it
is done in a sensible and prudent way
that supports customers, particularly
when times are hard.
Supporting first-time buyers into
homeownership is at the heart of
what we do in the mutual sector, and
this measure is a vital step in helping
those with smaller deposits access
the market.
The housing challenge in the
UK is not just about supply, it’s
about affordability. Many would-be
homeowners, especially younger
people and those affected by economic
instability, have been locked out of the
market due to rising house prices and
deposit shortfalls. Underwriting more
higher loan-to-value (LTV) mortgages
through this scheme provides an
important lifeline and helps shi the
balance for those on lower incomes.
We’re also supportive of the Bank
of England’s recommendation to
allow a higher mortgage lending limit
over 4.5-times income, alongside
the Financial Conduct Authority’s
(FCA) work to simplify remortgaging
rules. These reforms reflect a broader
willingness to engage with the realities
faced by today’s first-time buyers.
For our part, we must continue to
ensure that the mortgages people take
on are right for their circumstances,
especially if times become hard.
These initiatives must also go hand in
22
The Intermediary | August 2025
hand with beer financial education
and long-term saving incentives that
support deposit-building, including
the preservation and promotion of
the Cash ISA.
Delaying potential plans to cut Cash
ISA limits, and being willing to take
more time to consult with industry
experts as well as listening further to
the public, is a positive step forward.
In the lead up to the Mansion
House speech there was significant
pushback from customers, the press,
and the financial services sector,
and we applaud the Treasury’s
willingness to engage meaningfully
with our industry to explore other
possible solutions.
Empowering customers
As advocates for responsible saving,
we remain firm in our commitment to
promoting Cash ISAs as an accessible
and impactful tool for financial
empowerment. For many of our
customers, particularly those saving
for a deposit on their first home,
Cash ISAs provide a tax-efficient
way to grow savings without undue
complexity or risk.
For the moment, the Cash ISA and
its existing limits are safe, but reform
of this savings product may still come,
with more details expected to be
confirmed in the Autumn budget.
Many customers choose Cash ISAs
as they simply cannot afford to risk
losing their hard-earned capital
investing in stocks and shares. For
those that can, access to low-cost
financial advice remains a barrier,
with less than 9% of the UK population
receiving financial advice last year.
Too many people remain unsure
of how or where to invest their
money, particularly those from
underserved communities or younger
savers navigating the financial
JONATHAN WESTHOFF
is chief executive at West Brom
Building Society.
Many would-be
homeowners [...] have
been locked out of
the market”
landscape for the first time. If we
want people to invest, we need more
initiatives to bridge the ‘advice gap’.
We also welcome the FCA’s current
consultation to provide a simpler
regulatory framework in this area.
The Chancellor also confirmed that
there will be a marketing campaign
to inform customers of the merits of
investing in the Stock Market and how
this could further benefit customers’
long-term savings. Any messaging to
customers that reinforces and raises
awareness of these established savings
products – and the importance of
savings – is a positive, providing the
risks are also made clear.
Empowering people with access to
trusted, affordable financial advice is
not only key to increasing engagement
and building trust with financial
providers, but also vital to improving
confidence and outcomes in long-term
investment. By investing in tools,
platforms, and education initiatives
that demystify financial planning,
the Government and financial sector
can encourage a broader culture of
investment, ultimately strengthening
economic resilience and social
mobility across the UK.
As a mutual, we want our customers
to build a secure future for themselves
and their families, and as such would
welcome any strategies or initiatives
the Government introduces which
helps us and brokers achieve this. ●
