You are here: Home - News -

Mixed response to Government green paper on housing

  • 01/05/2000
  • 0
The Government's proposals for housing as outlined in its green paper, Quality and choice: A decent ...

The Government’s proposals for housing as outlined in its green paper, Quality and choice: A decent home for all, has been met with a mixed response from the mortgage industry.

The paper lays down plans for a Starter Home Initiative that aims to provide assistance to first time buyers with low incomes. This includes the possibility of interest-free loans for key workers in the public sector, such as nurses and teachers in areas where house prices and demand is high.

As yet no details as to how the scheme could work have been published and the Government is emphasising that it is only a proposal that will be dependent on responses to the consultation paper.

But the national press has suggested the proposal will take the form of an interest free ‘top-up’ loan of up to £50,000 on properties below £125,000.

This has the potential to save a borrower with a £125,000 property more than £150 a month.

While the proposal makes great headlines and is a sure vote winner, Ray Boulger, technical manager at John Charcol is sceptical.

He said: “This proposal is clearly still in the early stages. Nurses and teachers are bound to think it is brilliant, but from a market perspective it could create as many problems as it solves.”

“This move will mean that a lot of extra people who previously could not afford to buy will soon be able to do so, leading to increased demand in certain areas. This is not a problem if increases in supply can meet the demand, but if there is an imbalance prices could go up.”

Steve Cowdry, media relations manager at Nationwide, said the building society was interested in how the proposal will take shape.

He said: “As a major lender we have a keen interest to see how this develops over time, but we also think that existing low cost home ownership schemes need to be evaluated to see where room for improvement lies.”


There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.


Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.


Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.


Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.
  • My week on Twitter 🎉: 104 Mentions, 47.7K Mention Reach, 66 Likes, 50 Retweets, 41.6K Retweet Reach. See yours with…
  • Our first day of the Mortgage Administrator iVent has been a great success – don’t forget to join us again tomorrow…
  • Mortgage Administrator iVENT 2018: How to spot mortgage fraud -
  • RT @DanielleDennis9: Our first ever virtual event is looking great! Make sure you log in today, take a look around the stands and watch the…
Read previous post:
Lenders question B&B motive

Some mortgage lenders have yet to be convinced of the motives behind Bradford & Bingley's acquisitio...