Saturday, 25 October 2014

CLG refutes ‘help to buy’ second homes claim

The Communities and Local Government department has insisted the help to buy policy announced last week should not support the purchase of second homes.

The £3.5 billion low-cost homeownership initiative has come under fire after senior ministers refused to confirm whether or not it could be used to buy second homes.

Business secretary Vince Cable told the House of Commons last week that: ‘The scheme has not yet been designed in detail.’

A statement issued by the CLG states: ‘The intention of this policy is very clear: to help people get their first home or move home. It is not the intention to help people buy more than one home.’

The statement was released in response to an article in the Daily Telegraph that quoted planning minister Nick Boles as saying the government’s intention is to create a building boom and he ‘couldn’t care who owns the bloody things’.

Mr Boles also reportedly told a meeting with property developers that he wants to relax planning rules to make it easier for people to build homes.

He drew attention to a line in the Budget that states: ‘The government will consult on allowing further flexibilities between use classes to support change of use from certain agricultural and retail uses to residential use to increase responsiveness within the planning system.’

The CLG said the line ‘is about making use of what’s already there, converting unused, unviable buildings into homes without the need for red tape’.

Under help to buy two current homeownership schemes will be extended: shared equity scheme firstbuy will be boosted by extra funds, and eligibility criteria will be lifted; while guarantee scheme newbuy, which encourages lenders to offer 95 per cent loan-to-value mortgages, will be extended to cover existing as well as new homes.

Readers' comments (5)

  • Evan Owen

    Of course it can be used for BTL too, how can they police such a limp wristed initiative?

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  • Inside Housing editors please note: Refute definition "to prove to be false or erroneous". CLG have not refuted anything, they assert that the intention is not to help people to buy more than one home. Nice to know but from what we know of the scheme it will be possible to do that. The significant point is they havent come up with evidence despiye being pressed repeatedly.

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  • Chris

    Tenants may not have a spare room but home owners can have £3.5bn to buy a spare house - great Tory Values at work - They are all in it together!

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  • Ernie Gray

    The various initiatives recently announced by the government do not really help first-time buyers. Within vast swathes of the country it is almost impossible to enter the housing market without significant help from family.
    With some housing markets such as the movement within that there is almost no requirement for first-time buyers as the market is almost self perpetuating.

    I would argue for a portable housing allowance that could be targeted at either first-time buyers wishing to enter the market or for those who wish to enter the private rented market. The allowance would work similar to tax credits with a ceiling of £60,000 a year. This relief or credit would then reduce over a five-year period. Surely this would be a better way of creating opportunities. It could be argued that after the five-year period then the housing credit\allowance could be converted into a working families tax credit subject to personal circumstances.

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  • Chris

    Will the CLG 'refute' that immigrants will not be able to buy homes using the £3.5bn taxpayer slush fund for private ownership?

    Will the CLG 'refute' that MP's or their families will not be able to buy their second, third, fourth homes using this taxpayer funding?

    Or is it a massive fund for the Bullingdon crowd!

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