“The Government are backing 95% Mortgages. This could be the kick start needed to encourage urgent new builds in Manchester City Centre” Alison O’Connor

Article Source: Property Jungle

We’ll get Britain building again, says Cameron

The property industry isn’t exactly dancing in the streets but most believe that David Cameron’s new plans will help the housing market, if the plans are promptly executed and properly managed.

A Linden Homes site in Surrey was chosen as the press venue for the launch of the Government’s new Housing Strategy.

Prime Minister David Cameron arrived in Guildford to announce the government’s new Housing Strategy which will be underpinned by a new mortgage initiative for new homes.

It means a return – for some – of 95 per cent LTV mortgages for new build homes and a mortgage indemnity scheme, in which the government will underwrite part of the risk to lenders that could help up to 100,000 people.

The Prime Minister has also committed to providing an additional 200,000 new homes by 2015 through a “build now, pay later” deal. DCLG will now work with Whitehall to release ‘as much government-owned land as possible’ for private development. Local councils will also be encouraged to make their unused land available for development.

The government says that it recognises the need for greater availability of mortgage finance and responsible lending to the significant number of home purchasers who can afford mortgage payments, but not the levels of deposit currently required by lenders.

The British Property Federation (BPF) welcomed the government’s strategy, but warned there must be no delay or timidity in its execution.

RICS was also cautiously optimistic. Spokesperson Michael Newey, said that he hopes that the proposals can go some way to boosting the stagnant housing market. “Better access to mortgage finance is essential to bring forward the new homes needed to help more achieve their aspiration of home ownership, particularly first-time buyers. The New Build Indemnity Scheme is to be welcomed but care must be taken to ensure it does not distort the market or lenders affordability calculations.

“This is a good start from the Government but more detail is needed. RICS looks forward to continuing engagement with the Government and the sector to deliver a sustainable housing market that delivers aspirations across all sections of the market, benefiting UK PLC as a whole.”