Building new homes should be a priority

AS the years roll by, I become more concerned about the problems young couples have in getting on the property ladder.

The barriers of house prices escalating year on year more than inflation, coupled with the difficulties in getting a loan without having to make a substantial deposit is causing a lot of despair among those who aspire to have their own home.

Times have so changed over the years. Forgive a personal illustration. Exactly 60 years ago today, my wife and I were married and moved into our first home, a three bed-roomed semi in Great Barr. The price was £1,850 and I had to put down a deposit of £100 to acquire my 95 per cent mortgage.

My salary was £550 per annum, and although my wife was working, that fact was not allowed to be taken into consideration when applying for a loan.

My monthly repayments totalled about a third of my disposal income after tax and insurance, and there was little left for ‘luxuries’, but every penny we paid into the building society reduced our loan and increased the percentage that we owned.

Today life is much tougher for buyers. However, with interest rates so very low, investment in a house or flat is the very best way to save, especially when there is no tax to pay on any profit that accrues on sale.

Government says it wishes to see far more housing built. Experts are saying 250,000 new units a year are required to satisfy demand. The average built over the past decade is of the order of 135,000 – quite a shortfall.

The problem now is for Government to take action so that funding can be made available at reasonable rates of interest with much smaller deposits demanded, otherwise the market will be awash with empty properties.

To own one’s own home gives a great sense of satisfaction, so much better than paying away substantial sums in rent. We, as a young couple had to make sacrifices in the early years, but the investment and resulting hardship was very worthwhile.

Helping the young buy a property should be high on Government’s job list. Russell Luckock is chairman of Birmingham pressings firm AE

Harris