In George Osborne’s Autumn Statement last week, it was announced that efforts to increase home ownership were a priority. However, his words have come under fire from a former member of the Bank of England’s monetary committee.
In the statement, he claimed that to help buyers onto the housing ladder he had created a plan to “back families who aspire to buy their own home”, and also discussed expanding the help-to-buy mortgage scheme. Half of the 400,000 new homes planned to be built will be available to the under 40’s demographic at a 20% discount.
But Dame Kate Barker, a housing market expert, has been heavily critical of Osborne’s decision, as a similar method to try to improve home ownership went awry in the US. She comments: “I do feel uncomfortable about a set of policies that are designed to be supportive of people who are just on the cusp of being able to buy, and need nudging over the edge…In the US when they did that, it didn’t end well.”
In Osborne’s Autumn Statement, he outlined that he will back the construction of 400,000 homes in the next five years, although Barker has claimed that 300,000 will be needed each year.
Martin Wolf, the economist and Financial Times commentator, was equally critical of Osborne’s efforts: “to shift support away from rent for this part of society is likely to prove in the long run an unsustainable policy.”