The Chancellor’s new measures in the Budget aimed at boosting home ownership could have significant implications for ‘Generation Rent’.
The Help to Buy scheme will offer 95% mortgages on properties worth up to £600,000 from next January, and agents are saying that those keenest to take advantage will be tenants in the private rented sector.
Brendan Cox, managing director of Waterfords estate agents in the south, said: “It will have an effect on the whole of the market, as people who couldn’t afford such a large deposit will now have the help they require. It means first-time buyers will be able to get to the market earlier and get out of rented accommodation.”
Michael Robson, chief executive of Andrews, a regional chain of agents, said that that the 95% mortgage scheme would provide tenants with a “credible alternative to renting for many”.
The Chancellor also announced a five-fold increase in the Build to Rent fund, which backs institutional investment in new homes built for the private rented sector. The £200m made available in December’s Autumn Statement will be expanded to £1bn.â?¨
Ian Fletcher, director of policy at the British Property Federation, said: “It’s encouraging the Government’s confidence in build to rent has been reciprocated and we are delighted to see that the equity funding was heavily oversubscribed.
“Working in partnership with Government, the sector should deliver an exciting and quality array of homes for renters.”
Also in the Budget are promises to consult on proposals allowing shops to change into homes, and agricultural use to change to residential.
But within a day of the Budget announcements, there were accusations that the Help to Buy scheme could be starting to unravel. See next story.