Government schemes are generally well-received by those aiming to get onto the housing ladder, the BSA’s March Property Tracker
shows, with 45% of aspiring buyers saying that these schemes have made it easier for them to raise a deposit. A further 28% of people who aspire to buy say that the schemes have made no difference to them and a smaller group, 8%, say the schemes have actually made it harder for them to raise a deposit.
This quarterly consumer survey shows that those who aspire to buy with a mortgage are most commonly aiming for a 10% deposit (25%). A slightly smaller group (22%) are aiming to save over 25% of the cost of their first home. A quarter of people think that they will raise their required deposit within a year, three-quarters within 5 years.
While Government schemes are being viewed on balance positively with only 8% of people unaware of them, their existence highlights that there is still a significant lack of new house building. Government schemes are helping to fuel buyer demand and aid the financial ability to buy, but do not address the underlying chronic lack of affordable homes, which is acute in some areas like London. Commenting on the results, BSA Head of Mortgage Policy, Paul Broadhead, said:
“A significant proportion of aspiring homebuyers say that Government schemes have helped them to raise the required deposit to get on the housing ladder, which is good news.
However, these are clearly demand side interventions that address the symptoms and not the root cause of the problems in the housing market: the fact that affordability is becoming stretched across all tenures; and the failure of successive Governments to build or facilitate the building of sufficient homes of the right type, across mixed tenures in the right places.
Help to Buy mortgage guarantee, which is arguably the Government’s most successful and high profile scheme, comes to an end at the end of this year. Some lenders, including many building societies, were active in the high loan-to-value (LTV) market before the scheme, and will likely remain so when the scheme ends. It is vital that the Government clearly articulates its strategy to maintain consumer confidence and avoid a squeeze in the number of mortgages available at high LTVs once it is gone.”
To see the Property Tracker report in full, please click here
For further information, contact:
Hilary McVitty - Tel: 0207 520 5926
Notes to editors:
1. The Property Tracker survey is conducted quarterly by Canadean Consumer for the Building Societies Association. Figures prior to June 2012 are from YouGov Plc. Total sample size was 2,000 adults. Fieldwork was undertaken between 26 – 28 February 2016. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+).
2. The Building Societies Association (BSA) represents all 44 UK building societies. Building societies have total assets of over £340 billion and, together with their subsidiaries, hold residential mortgages of over £265 billion, 21% of the total outstanding in the UK. They hold over £245 billion of retail deposits, accounting for 18% of all such deposits in the UK. Building societies account for about 31% of all cash ISA balances. They employ approximately 40,000 full and part-time staff and operate through approximately 1,550 branches.