Mortgage Matters - Pre Election

Here at Mortgage Required, we have noticed that uncertainty over the General Election has failed to put a substantial dent in mortgage lending. My guess is that there are a few of good reasons for this:

1. The mortgage price war between lenders, which has seen 5 year fixed rates fall below 2 per cent for the first time ever

2. Low (or no) inflation, means the pounds in your pocket go further, and this in turn makes us feel richer and more likely to take the plunge and get a mortgage.

3. Each of the major parties seem to know that the housing market is central to our economy and to mess with it whilst it’s on the up, would be political suicide!

Whilst the Conservatives pledge 200,000 new starter homes for first time buyers under 40, along with extensions to both the Help to Buy and Right to Buy schemes, Labour intend to create a £5 billion fund to build houses for locals.

Ed Miliband says a Labour government would exempt first-time buyers in England, Wales and Northern Ireland from paying stamp duty when buying homes below £300,000, for three years. I seem to remember the last stamp duty holiday caused a spike in demand, which was immediately followed by a slump when it finished. Having working in the mortgage market for 20 years, I am a fan of nether spikes nor slumps!

The Lib Dems have less to say on housing, but they are planning on sorting the banks out (again?) if they come to power and the Greens intend to stop the Right to Buy Scheme and make us think of our houses as homes rather than investment. With a nation as obsessed as ours with the value of our houses Natalie Bennett may have her work cut out!