Pledge of ‘a roof of their own’ is not enough: IEA

Pledge of ‘a roof of their own’ is not enough: IEA

“In order for advisers to help get more potential borrowers onto the housing ladder and into affordable homes, planning laws should be liberalised”, a think tank has claimed.

Mark Littlewood, director general at the Institute of Economic Affairs, said the government had to be firmer on policy to create affordable housing.

He said: “The exorbitant cost of housing in the UK is a direct result of government regulation. Until we see meaningful liberalisation of planning laws, Britons will continue to face high rents and a diminishing chance of getting on the housing ladder.”

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Mr Littlewood was responding to prime minister David Cameron’s speech given at the Conservative Party Conference on 7 October in which he pledged to help generation rent buy a “roof of their own”.

Mr Cameron confirmed that planning laws would be changed to allow developers to offer starter homes priced at 20 per cent below market rate, instead of building affordable homes to rent.

He said the policy would create 200,000 homes by 2020 for buyers aged under 40, and mean a shift “from generation rent to generation buy”.

However, Shelter, the housing charity said the policy would create homes that were out of reach for families on average earnings in 58 per cent of the country.

Adviser view

Andrew Montlake, director for London-based mortgage adviser Coreco, said: “Politicians really do not get it. So-called starter homes will just stymie social mobility.”