In a recent conservative conference, Boris Johnson promised to create two million more homeowners by changing ‘generation rent’ into ‘generation buy’, in the hope that the UK can return to normal post-COVID.
Mr Johnson continued by suggesting that the current levels of home ownership among the under 40s was ‘disgraceful’.
These levels have been plummeting dramatically over recent years, which has made people “pay through the nose to rent a home which they can’t truly love or make their own”.
To do this, changes to the regulations introduced in 2008 are required.
Previous strict minimum capital requirements, which were imposed on UK banks, are being blamed for initially making owning a house unattainable for various individuals.
These individuals may have been able to afford the monthly mortgage fees associated with homeownership, but the initial upfront deposit being between 15 and 20 per cent, it’s clear to see why renting was the only option for most.
Due to this, private rent increased from 2.8 million in 2007 and to 4.5 million in 2017.
So, what’s the solution?
The Prime Minister’s ambitious plans to ‘fix our broken housing market’ begins by slashing the current deposit rates to only 5% for first-time buyers.
As a result, this will be the biggest expansion of the sales market since the 1980s.
This will be welcome news for potential first-time buyers nationwide, and a great boost for the property market post-lockdown.
First-time buyers are more resolved to become homeowners in 2020, despite the pandemic
As a direct result of lockdown, three in five Brits are determined to purchase their first home, with nearly half having saved more for their deposit this year than they'd expected.*
What support is there for prospective homeowners?
At Northfields, we appreciate that many tenants will now be in a position where they're ready to commit and buy their first home.
If that's you, we'd like to help.
As dedicated West London agents, we can help you to navigate the local market and make the right decisions with your investments, click below to find out more or contact us on 020 8740 6622.
*Source: Yorkshire Building Society