Conservative party leadership hopeful Rishi Sunak says he wants today’s renters, along with young adults obliged to live at home with their parents, to become capitalists - and that means getting their hands on capital in the form of home ownership.
He told Sky News over the weekend: “We are the standard bearers for capitalism. But we can't expect future generations to share our belief in capitalism if they can't get their hands on capital. That's why I'll do whatever it takes to build affordable, plentiful housing, building the next generation of Conservative voters.”
The former Chancellor wants developers to finish a project before they can be granted new planning permission for other plots in the same local area, while local authorities will have greater compulsory purchase powers to buy undeveloped land at a discount if it has not been built on within an agreed time frame.
To avoid existing communities having too many new homes without appropriate local facilities, he has also pledged a new 'infrastructure first guarantee', which aims to ensure all new homes are supported by enough local doctors, schools and roads.
In the same debate his rival for the leadership, Liz Truss, said her way of making housing more affordable for young buyers would be to allow a history of paying rent on time to be used to help secure a mortgage.
Truss said she would amend the current Levelling Up Bill to replace centralised housing targets with tax cuts and reduce red tape in 'opportunity zones' to make it easier and quicker for developers to build on brownfield land in order ”to get our economy moving.”
Government figures suggest that more than half of today’s renters could in fact afford the monthly cost of a mortgage, but securing a deposit and a mortgage are larger obstacles.
Earlier this year a YouGov poll found that 76 per cent back the idea of lenders accepting a history of regular rent payments as proof of affordability when it comes to applying for a mortgage.
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There are millions of people trying to find somewhere to live because private Landlords are being forced out. Will the people who have been, and will be made homeless when Landlords sell up be voting Conservative.
Solve the Housing Crises by supporting the private Rental sector.
Yet again politicians showing how clueless they are about reality
It can take years and multiple planing applications before planning permission is granted on big sites. Two near me have both had problems. One has finally got permission for 184 houses instead of the original 200 applied for. The other site is owned by the Council, is being developed by a company the Council have a large stake in, is a derelict brownfield site and it still took years and multiple planning applications for the Council to give themselves planning permission. Once they had finally got permission they decided to vary it and bin the social rented flats they had insisted on in the first place on viability grounds.
With rising interest rates it's uncertain what will happen to house prices so the ability to build capital in the form of housing equity is questionable. I bought a house in 1991 (3 years after the 1988 market peak) for 67% of it's 1988 asking price. Even then it carried on dropping in value and was in negative equity until about 2001. Logic indicates house prices should fall as monthly mortgage payments get bigger due to higher interest rates but if mortgage terms are lengthened that stabilizes the monthly payment so maybe houses prices will keep rising? It's more of a gamble right now than it has been since 2009. My advice to FTBs would be don't buy a property that is going to be too small for you in the next 10 years. Negative equity only really matters if you need to move house.
Infrastructure first is a nice soundbite but who is going to pay the wage bill of the doctors who don't have sufficient patients or the teachers rattling round a virtually empty school? If kids are bussed in from elsewhere to fill the spaces those spaces aren't available for families moving into the new houses that will be built. Happened on the estate I live on. Within 5 years of the school opening kids that were moving into houses directly opposite the school were being refused places because the school was oversubscribed as they were bussing kids in from miles away. Eventually they solved the problem by enlarging the school by 50% by building on the playground.
There is nothing stopping lenders looking at rent payment histories. Just because it doesn't show on Equifax doesn't mean lenders are unaware of it. The all ask for at least 3 months bank statements so can easily see the rent payments being made. Lenders are fully aware that there is far more expense to owning a house than just paying the mortgage. There needs to be enough income to pay for insurance, boiler servicing, repairs, maintenance, utility costs, Council Tax etc. All those things that are included in the rent for the room in an HMO that they've been living in.
OMG - heard it all now!! not got a clue!
Jo I agree I also bought a house in 1991 for 91k that had been bought 3 years earlier for £136k, the owner couldn’t keep up the payments she stopped paying altogether she had some lodgers as well but evictions wasn’t a problem she put their belongings outside, no point in big daddy council taking her to Court or Penalty hmm. Think this can’t happen again think on with the added insult of incumbent WHITE PAPER .
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