In a speech to the Confederation of British Industry (CBI) North-East Annual Dinner tonight, its director-general, John Cridland, will say that boosting activity in the housing market and construction sector could be a major “game-changer” for growth.
He will say it could unlock £60bn of potential investment currently on company balance sheets and create new jobs into the bargain.
Cridland said: “I want to see the Chancellor use his autumn statement on 29 November to jump-start the housing market.
“A determined attack on the major blockers of finance and planning could transform the outlook of a generation of young people and provide a huge fillip to consumer and business confidence.”
Mortgage lenders need to strike more deals with house builders, he said, and government should step in a focused way to bridge the affordability gap.
“Another way of helping first-time buyers to access finance to get on the property ladder could be to allow them to access locked savings in their personal pension pots through a loan-back scheme. Members of company schemes could borrow money from their own pension pot at a low cost, paying the loan back through their salary at any time during their working life,” said Cridland.
“Also worth further exploration is Shared Ownership. It was successful during the Thatcher years and a new 21st century model of ownership could make a difference.”
“Owning a home has been a natural aspiration for generations of Britons since the 1950s. It has never been easy but after this recession, the high cost of property, strict lending rules and the need to save substantial deposits has put home ownership out of reach for all but the lucky few.
“As we have seen, without a steady stream of eager first-time buyers the housing market stagnates and our whole economy suffers.
“According to the Council of Mortgage Lenders, 36,200 first time buyers bought homes in the first 3 months of this year compared to 43,600 in the first 3 months of 2010. This compares with 167,400 first time buyers at the peak of the market in 2001.
“Now is the time to stop the stagnation and get the housing market flowing again,” he said.
