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Steve Brine MP: One of the most important things the Government can do is get more people on the property ladder

Brine SteveSteve Brine is the Member of Parliament for Winchester.

It is frequently asserted that we are a nation of homeowners and how owning or striving to own your home makes financial sense, brings independence and is a source of great pride for many. It was Anthony Eden who first set out the noble vision of a "nationwide property-owning democracy", and the aspiration amongst people to one day own a property remains as strong as ever.

This is the starting point for me. Government absolutely should exist to help its people realise their aspirations, not through a hand-out but always through a hand-up. This subject, for me as a Conservative, is unapologetically about values.  Politicians these days don’t talk about what they believe in enough.  It’s as if ideology has become a bad word and it’s suddenly a crime to say what drives us.

Since 2008, the number of first-time buyers has declined from a long-term average of around 500,000 a year to just 200,000, and we know from DCLG figures that between 2000 and 2007, the average UK house price more than doubled from £106,000 to £214,000. For many first-time buyers, particularly those unable to access finance from the ‘Bank of Mum and Dad’, these high prices have either delayed or ended their hopes of owning their own bricks and mortar. It is also a widely accepted fact of economic reality that house prices are high, in part, because housing in this country is in relatively short supply.

In 2007 there were 178,000 housing starts. By 2009, the last full year of the previous Government, that had crashed to 78,340. In 2011, the first full year of the coalition Government, it had risen to 98,250—a rise of 25%, but we are still clearly well short of where we want to be – and where we need to be. So, building more new affordable homes should clearly be a priority and I hope for all our sakes the new incentive-led and plan-led approach combined with policies such as the New Homes Bonus will make a significant difference.

Undoubtedly, the biggest obstacle facing people who want to own their first home lies in the size of the deposit required before even being considered for a mortgage, and the Council of Mortgage Lenders has estimated that the average deposit for a first-time buyer now stands at over £26,000. Even as house prices have started to fall slightly in recent years, challenging funding criteria has meant that ever larger deposits are required, making the dream of home ownership for many first time buyers nothing more than a remote fantasy. Add to this the rising costs of living and job uncertainty, and the picture can appear somewhat bleak indeed for aspiring home owners.

Of course, there are limits to what Government can do, but for me, the most important step the Government has taken to support greater home ownership lies in its commitment to ensuring that interest rates are kept as low as possible for as long as possible, by getting to work tackling the national structural deficit. It is a factor easily overlooked, but without a credible plan to put the public finances on a stable footing, the inevitable higher interest rates that would result would also lead to higher monthly mortgage payments and increased repossessions. This key point should never be understated.

As well maintaining the conditions necessary to secure a low interest base rate, the Government has also introduced a range of initiatives designed to support prospective first-time buyers to own their own home. With the sort of timing I couldn’t have planned for – and, for the record, I didn’t – we have seen two key announcements this week, NewBuy and Right to Buy. NewBuy makes it possible for first-time buyers and existing home owners to get a mortgage on a new-build property with only a 5 per cent deposit, while the Government’s reinvigorating of the Right to Buy scheme, by raising the maximum discount available from the current limit of between £16,000 and £38,000 to £75,000, will be warmly welcomed in my constituency.

As I have said many times, the big stick approach to increasing supply failed - under the previous government, house building fell to its lowest level since the 1920’s. My aspiration for the new system of localism is simple; that local authorities will step up to the plate, stop looking to London for their orders and work with local communities to deliver the homes their area needs. People in my constituency recognise the facts and they want to build new homes because they know the people locked out right now are their own children and grandchildren, and with that in mind I welcome the coalition’s plan to release public sector land with the capacity for up to 100,000 new homes and the £400m Get Britain Building investment fund to support firms in need of development finance.

In conclusion, I believe having the chance own your own home is one of the best things a Government can do for its people.  My parents’ generation saw it as a rite of passage, but it’s more complicated than that these days. Young people have every right to believe if they work hard, do the right thing and save, they will have a Government on their side and can get on the property ladder.  I welcome the steps this Government is taking to reinforce and yes, to lower the bottom rung of that ladder.


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