The Government has unveiled a new permanent mortgage guarantee scheme as ministers ramp up efforts to support first-time buyers (FTBs) amid growing concerns over affordability in the housing market.
The initiative comes as many FTBs scramble to secure homes before a scheduled stamp duty increase at the end of next month. Those who miss the deadline, as well as tenants grappling with soaring rents, could now benefit from the new scheme.
Relaxing Mortgage Rules
In addition to the guarantee scheme, the Government has backed proposals from the Financial Conduct Authority (FCA) to ease mortgage application criteria. Ministers have urged swift implementation of the changes to help more people onto the property ladder.
“For too long, politicians have ducked and dodged the decisions needed to support homeownership,” said Treasury Minister Emma Reynolds.
“Simplifying responsible lending rules and introducing a permanent mortgage guarantee scheme demonstrates our commitment to making homeownership a reality. I will work closely with regulators and the industry to ensure this happens as quickly as possible,” she added.
Tackling the Housing Crisis
Housing Minister Matthew Pennycook echoed these sentiments, warning that affordability issues have left an entire generation locked out of homeownership.
“This government is determined to change that, ensuring that young families and hardworking renters can buy a home of their own,” he said.
The new Mortgage Guarantee Scheme will replace the existing program, which was set to expire this year.
Meanwhile, the FCA has announced plans to review and potentially simplify mortgage lending rules introduced after the 2008 financial crisis, aiming to make home loans more accessible to buyers.