Keir Starmer and Angela Rayner claimed Labour was the “party of homeownership” as they launched the ‘Freedom to Buy’ scheme
The Labour party’s ‘Freedom to Buy’ scheme will make the Conservatives’ mortgage guarantee scheme permanent, with the aim of enabling 80,000 more young people to get a mortgage with a lower deposit over the next five years.
The existing mortgage guarantee scheme was due to expire June 2025.
The planning and housing reforms, per Labour’s website:
- Planning reform to build 1.5m homes.
- A Freedom to Buy Scheme to help people secure a mortgage
- First dibs for local people on new developments, ending the farce of entire developments sold off to international investors before local people get a look in
- Tax foreign buyers to fund planning officers: by taxing foreign buyers pricing out young people, we can fund new planning officers to approve homes next generation needs
- Reform compulsory purchase rules to get homes built
🏘️ @Keir_Starmer will not sit by as the Tories leave a generation of young people to become renters for life.
Labour will get Britain building and deliver the change needed to get first-time buyers on the housing ladder. pic.twitter.com/ZXit8zbXNx
— The Labour Party (@UKLabour) June 7, 2024
Freedom to Buy and the New Towns Code are some of Labour’s early flagship policies
Labour has announced a raft of housing and planning policy as part of the general election campaigning, including building 40 new towns via streamlined planning in the form of a New Towns Code.
A spokesperson for Royal Institution of Chartered Surveyors (RICS) said: “We welcome Labour’s announcement, planning authorities should put a greater focus on design codes for attractive homes that fit community needs. Pushing developers, and potentially rewarding those, who invest in beautiful buildings and streetscape. However, it’s imperative that any design codes do not add an extra layer of bureaucracy to the planning system, which is already suffering from delays, skills shortages, and increased red tape.
“We’d also like to see Labour go further and commit to implementing whole life carbon assessments as part of the planning permission process as a fundamental element in understanding and tackling carbon emissions.”
5% deposit is “more achievable”
“Labour’s announcement today demonstrates a long-term strategy to boost first time buyer homeownership, providing a route onto the ladder with a more achievable 5% deposit,” said Lynda Clark, CEO fo First Time Buyer Group.
“Committing to a permanent mortgage guarantee scheme will not only support tens of thousands more first time buyers onto the ladder, but will stimulate the market and instil both lenders and developers with confidence to broker deals and accelerate housebuilding.”
Critics have accused the policy of ignoring renters
Generation Rent’s chief executive, Ben Twomey, said: “Renters deserve security too. While attention to the housing struggles of young adults is welcome, our work or personal circumstances mean not all of us are able to live at home with parents until we save enough to buy our first home.
“12 million people are privately renting right now and more than half of us have no savings at all.
“Trying to put aside a house deposit while renting is like pushing a boulder up a hill that keeps getting steeper and steeper.”
Mr Twomey added: “The next government must slam the brakes on soaring rents by limiting the current free-for-all that’s forcing a third of renters’ incomes straight into the pockets of landlords.
“This proposed scheme would make permanent the existing ability for people to buy their first home with just a 5% deposit.
“But 5% still means £12,497 on the average first time buyer mortgage, and as much as £21,669 if looking to buy in London.
“If rent rises continue to outpace wage growth, more tenants could face homelessness than benefit from this scheme.”
