Osborne's housing revolution
MORE THAN two million people will be able to buy their first homes under Conservative plans for a 1980s-style housing “revolution”, George Osborne announces today.
In a major new election pledge, the Chancellor says he wants to double the number of first-time buyers so that 500,000 people a year are getting a foot on the housing ladder by 2020.
In an exclusive interview on the campaign trail, Mr Osborne tells The Sunday Telegraph that his policies will see one million homebuyers given direct government help to purchase properties, turning Britain into a “homeowning society”.
But he wants to “go further” for first-time buyers and create the conditions in the housing market to bring property sales back to the levels seen during Margaret Thatcher’s leadership.
Since the 2010 election, there have been 1.2million purchases by first-time buyers. Mr Osborne wants this to rise to at least 2.4 million over the next five years.
He is expected to use a Budget early in the next parliament if the Tories win power to detail new measures to deliver his targets, potentially including action to encourage building on brownfield sites and more help with mortgage loans.
“I think we can deliver a revolution in home ownership,” the Chancellor says. “We want to see a massive increase in the number of people who can own their own home because home ownership is an absolutely core Conservative belief and aspiration that we support. In the next parliament I would like to see over a million more people helped into home ownership by a Conservative government.
“I would like to see us double the number of first time buyers, up to half-a-million (a year). That is the kind of level we saw in the 1980s. There is no reason why our country can’t achieve that again. That’s a goal we set ourselves today.”
In the interview, with one month to go until polling day, the Chancellor also says: ÞEd Miliband represents a bigger threat to Britain’s economy than Greece and the recovery “will end” if Labour gains power. ÞThe Tories are deliberately leaving their “options open” to bringing forward promised income tax cuts for the professional middle-classes sooner than planned. ÞMore than two million pension savers over the age of 55 should “make the most of” the revolution in pension rules which will mean they can spend their life-savings as they choose from tomorrow. But he says: “Take your time, if you need time to make the decision.” ÞThe Tories have the “momentum” in the election campaign and are confident of winning a Commons majority on May 7.
Mr Osborne’s pledge will be seen as a contrast to Labour’s attitude to property ownership. Mr Miliband wants a new tax on “mansions” worth more than £2million and yesterday announced plans to divert savings from Help to Buy ISAs to fund house-building schemes.
Mr Osborne said this would “undermine home-ownership and harm savers”.
The interview took place on Friday, before Labour announced a housing policy to create a fund for 125,000 homes for first-time buyers. Tory critics described the Labour plans as “panicked” and “unravelling” yesterday amid suggestions that the policy had been rushed out.
Mr Osborne says he will meet his ambitious targets through the growth of schemes such as Help to Buy loans, in which the government takes a stake in newly built properties to help first-time buyers.
Under Help to Buy ISAs, announced in the Budget last month, the government will topup the savings of first-time buyers to help them put down a deposit for a home.
Other future measures around Help to Buy schemes could include a radical expansion of Right to Buy, which Mrs Thatcher’s government introduced to give council tenants the power to purchase their homes.
Critics say it has cut the number of council houses available to the poor, but Tories want the scheme to be extended to allow the sale of housing association properties. Mr Osborne does not rule it out.
The Chancellor also warns local authorities that they could be forced to sell their most expensive council houses to pay for cheaper housing.