IMLA said policy focus has suffered from being ‘short-term, eye-catching and also offering conflicting measures over the last 30 years.
In its paper UK Election 2015 – criteria for housing and mortgage policy pledges, IMLA also reflected that that the mortgage Market Review has resulted in a far more conservative mortgage market.
With owner-occupation set to fall from 64% to 59% over the next five years over the next parliament¹, IMLA called for five things to be tackled by any incoming government.
These include:
• Establishing a programme for a properly managed withdrawal of government measures supporting the housing market
• Implementing a state or privately backed mortgage indemnity guarantee (MIG) to succeed Help to Buy and support high loan to value (LTV) borrowing in the long term
• Introducing measures to support downsizing by older households and increase liquidity in the housing market – along with a review of lending into retirement
• Carrying out a full review of the cumulative impact of regulatory changes for mortgage lending, including new capital adequacy requirements, macro-prudential rules and affordability assessments
• Engaging in an open discussion on the role of the sub-prime mortgage market in helping to meet consumer needs
Peter Williams, executive director of IMLA, (pictured) said: “Homebuyers face much greater challenges as a result of house price rises and financial services regulation; private renters are confronted by high rental inflation and variable quality; and social renting no longer provides an adequate safety net for those who cannot afford to house themselves via the market.
“A ‘one-size-fits-all’ solution for housing policy is no longer viable, if it ever was.”
He added: “Housing is a long term challenge that demands long term solutions and one which requires cross party support.”
Patrick Bamford, director – Mortgage Insurance Europe for Genworth, said: “
A permanent successor to Help to Buy would go a long way towards addressing two of the greatest challenges the industry faces: continuing access to homeownership and a sustained increase in housing supply.
“This should be transferred to the private sector and implemented well ahead of the end of Help to Buy 2 to achieve a smooth transition. Private mortgage insurers have the capacity and the willingness to take over from Help to Buy and build on the gains already made. This would reduce any risk to the tax payer while maintaining sensible checks to protect the financial system.”
