Government housing package criticised by group

09/09/2008

The government's latest package of housing finance reforms is near-useless - because the market is falling.

Advisors network, the UK Insolvency Helpline, said today that the moves did little to alleviate the property sector's core problem: the fact that mortgage firms are restricting lending to customers due to the credit crunch.

Last week, communities minister Hazel Blears unveiled the housing plans - which include suspending stamp duty for a year on homes worth £175,000 or less and increased help for certain groups who have fallen behind on their mortgage payments.

Ian Boden-Smyth, PR spokesman for The UK Insolvency Helpline, said: "Until we see mortgage rates come down, and mortgage companies becoming a little more relaxed in their lending again, it is not going to make too much difference…the industry has [now] withdrawn many of the attractive products that were very good for first time buyers, or people with bad credit.

"The stamp duty exemption is not much help in a falling market. It's going to help current owners but not first time buyers."

He added: "What we want is to kick start the economy into getting the younger people on the housing ladder, and the first time buyers."

Tags; Housing Debt and Bills, Young Family Finances,

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