Lenders threaten local lifetime homes plan

Matthew Taylor, MP for Truro and St Austell, who chairs the National Housing Federation, called for more lifetime affordable homes, after being commissioned to look into rural housing problems by prime minister Gordon Brown. His influential report into the subject was published in 2008. In its response to the report the government confirmed it intended to create ‘protected areas’ where shared ownership homes would be retained for future local purchasers.

But at the South West Housing Summit last week, Mr Taylor revealed that lenders had been less than enthusiastic about the idea.

He added: ‘There are still some lenders in this market but even they are pretty worried.’

A spokesperson for the Council of Mortgage Lenders, confirmed that lenders were not keen on restrictions over who properties could be sold to in the future.

‘It’s a concern because the key principle of a conventional mortgage is that the property provides security for the loan, and if mortgage repossessions are made the lender has recourse to that property. If there’s a restriction on the area for the lender to resell the property then that’s a concern.’

The National Housing Federation said it was aware of some lenders which were willing to lend on these types of schemes but there were no overall figures.

Lucy Thornycroft, investment leader at the NHF, said: ‘In rural communities where there is a severe shortage of homes it is often necessary to keep homes affordable in perpetuity to encourage landowners to bring forward land.

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