The Help to Buy ISA scheme announced in the Budget received a broad welcome from the panel at a Virgin Money video debate, but a spokesman from L&G said the three-years taken to save could put borrowers behind house price inflation.
Jeremy Duncombe, director at Legal and General (L&G) mortgage club said anything that helps first-time buyers should be supported.
“But if the [house] prices go up by more than £3,000 over the three years it takes to save, you’re behind the curve,” he said.
“As ever, building more houses is key to supply, it has to be there and would make homes more affordable.”
Nigel Stockton, financial services director at Countrywide countered that it may be London-centric to suggest price inflation could outstrip the savings scheme, as the average UK purchase is still only £140,000.
“The trouble with housing is it takes more than one government term to sort it out,” he added.
Peter Rogerson, commercial director for mortgages at Virgin Money said there was plenty of work to do before the scheme launches in the autumn.
“I think we’ll see some innovation from the product and anything that keeps first-time buyers in the market with further solutions has to be a good thing,” he added.
Panelists (from screen right to left)
Chair, Victoria Hartley, group editor, Mortgage Solutions
Peter Rogerson, commercial director for mortgages, Virgin Money
Richard Tugwell, director of intermediary relationships, Virgin Money
Robert Sinclair, CEO, AMI and the AFB
Nigel Stockton, financial services director, Countrywide
Jeremy Duncombe, director L&G mortgage club