Plans to help young on to housing ladder welcomed
Youngsters struggling to buy a home would be able to use their parents or grandparents' retirement funds to help secure a mortgage under a new Government initiative.
Nick Clegg, the deputy prime minister, announced the proposals for getting more people on the housing ladder, last week.
Details of the scheme are yet to be finalised, but aides said it would see the lump sum element of pensions used as collateral for raising home loans.
James Birt, partner at Naylor Powell estate agents, which has offices in Gloucester, Newent and Stonehouse, said it was "very interesting news" for estate agents.
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He said: "So many people are already helped with their first-time purchase by parents or grandparents but this really is a great step in the right direction and could have a significant effect on the property market."
Hundreds of thousands of people could be eligible for the arrangements, which are expected to be in operation by 2015.
Parents would lose their lump sum if the child defaults on mortgage repayments, but the rest of the retirement fund would be unaffected.
Jeremy Drew, design director of county-based Newland Homes said the move could make a positive difference.
He said: "Our younger customers often turn to the bank of mum and dad for help in buying their first home. It would be great if this willingness to help could be further incentivised and supported. That sort of thing could make a small but meaningful difference."
Speaking at the Liberal Democrats' autumn conference in Brighton, Mr Clegg said: "We have thousands of young people who are desperate to get their feet on the first rung of the property ladder but deposits have doubled and the number of young people asking help from family members has doubled.
"So I can announce today that the Government is going to do something that hasn't happened before. We are going to work out ways in which parents and grandparents who want to help their children and grandchildren buy a property of their own, we are going to allow those parents and grandparents to act as a guarantee, if you like, so their youngsters can take out a deposit and buy a home."
However, experts have warned the proposals risk leaving people short when they came to give up work.
In another measure designed to please Lib Dem activists, Treasury chief secretary Danny Alexander revealed that a crackdown on tax dodgers was being extended to people with houses and assets worth over a million pounds. Scores more staff are being recruited to HM Revenue & Customs' "affluent unit" to make sure the wealthy pay their dues.
Comments
by SandraPee
Wednesday, September 26 2012, 1:14PM
“Can anyone remember the record '' They're Coming To Take Me Away Ha Ha ' ? !! Don't know about Nick Clegg being ''sorry'' , but this must be his record ......... !”