The Evening Standard and Daily Mail quote Emma Humphreys on Jeremy Hunt's 'one percent deposit' plans
min readBritons could be allowed to buy a home with just a 1 per cent deposit under plans reportedly being drawn up by Jeremy Hunt ahead of next month's Budget.
The Chancellor is said to be considering a 99 per cent mortgage scheme as the Conservatives 'try and woo younger voters ahead of the general election'.
But some industry figures are now warning of a greater risk of homeowners falling into negative equity, which is where the value of a property falls below the outstanding debt secured on it. They also said plans for 99 per cent mortgages would do little to address the affordability of mortgages themselves, high house prices, or a lack of housebuilding.
Emma Humphreys, Partner in our real estate disputes team, comments for the Evening Standard and Daily Mail:
These proposals would help first time buyers afford a deposit, but they don't fix the issue of affording a home. This growing matter of mortgage affordability would only be exacerbated by 99 per cent mortgages, as more people on the market increases demand and competitiveness.
"This fundamental issue comes back to supply and demand. The Government simply needs to build more affordable housing, rather than announce temporary measures which are sticking plasters covering the real issue.
Read the full articles in the Evening Standard here and the Daily Mail here.
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