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Housing Subsidy And Mortgage Interest Relief

Volume 932: debated on Wednesday 18 May 1977

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asked the Secretary of State for the Environment whether he will estimate the total cost to date of housing subsidy and rate fund contribution of a local authority house of average cost built for letting in 1950 and the cost of mortgage interest tax relief on a similar house built at the same time for owner-occupation, assuming an average frequency of transfer; and what is his estimate of the average respective costs of the same houses over the next 27 years assuming the continuation of present trends.

A local authority house built in 1950 would have attracted £363 of Exchequer subsidy and £33 of rate fund contribution in the period to 1971–72, when subsidies on individual houses ceased. If a similar owner-occupied house had been bought with an average size mortgage in 1950 and resold with average size mortgages at seven-year intervals thereafter—the average frequency of resale—with occupiers on standard rate tax relief, mortgage interest tax relief less Schedule A would have totalled about £550 over the same period. Only some of these assumptions would apply in most cases.