BSA: Opening the housing market to first time buyers
The BSA was one of the key industry bodies representing the mortgage, housing, insurance and charitable sectors that attended the First Time Buyer industry summit on 15 February 2011 chaired by Housing Minister, Grant Shapps.
Paul Broadhead, BSA Head of Mortgage Policy, took the opportunity to re-iterate it is not merely the shortage of mortgage funding that is causing difficulties in the housing market for first time buyers.
Broadhead commented:
“There have been increasing affordability issues in recent years as house prices outstripped earnings growth. There are also demand side factors to consider such as volatile house prices and job insecurity which continue to make potential first time buyers nervous.
Any initiatives focussed purely on first time buyers, without a sufficient increase in house building, could push prices up for entry level properties; particularly if second time movers have low or negative equity.
Funding, both the availability and cost of it, continues to cause difficulty for mortgage lenders. As does the increased cost of lending at higher LTVs (through new capital requirements).”
The BSA believes that today’s meeting could be the start of a process that re-examines and re-evaluates the housing market and that bringing industry and government bodies together in one room has kick started the process. It would urge caution, however, against the meeting being viewed as an immediate solution to all the issues faced by first time buyers.
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Notes to Editors
1. The Building Societies Association (BSA) represents mutual lenders and deposit takers in the UK including all 48 UK building societies. Mutual lenders and deposit takers have total assets of over £365 billion and, together with their subsidiaries, hold residential mortgages of almost £235 billion, 19% of the total outstanding in the UK. They hold more than £245 billion of retail deposits, accounting for 22% of all such deposits in the UK. Mutual deposit takers account for about 36% of cash ISA balances. They employ approximately 50,000 full and part-time staff and operate through approximately 2,000 branches.
2. Photographs of Paul Broadhead are available from the BSA press office, from the Association’s website at www.bsa.org.uk or Headlinemoney www.headlinemoney.co.uk
3. Contact
Fiona Cornes – fiona.cornes@bsa.org.uk / 020 7520 5926
Katie Wise (nee Errington)
Policy and External Affairs Officer
Building Societies Association
6th Floor, York House
23 Kingsway
London
WC2B 6UJ
Tel: 020 7520 5904
Fax: 020 7240 5290
Email: katie.wise@bsa.org.uk
Web: www.bsa.org.uk
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