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First-time Buyers

Volume 519: debated on Thursday 25 November 2010

19. What estimate he has made of the change in number of first-time buyers in the housing market in the last 12 months. (26218)

According to data from the Council of Mortgage Lenders, the number of first-time buyers has fallen slightly over the past 12 months, by around 5% in total.

Is the Minister aware that those figures are among the worst ever for first-time buyers? Is he further aware that the calculations put out by the British Bankers Association on Tuesday of this week show that the level of new mortgage approvals is at its lowest for 19 months, and that the level for gross mortgage lending is the lowest for 10 years? This is a disastrous situation for hundreds of thousands of young couples who want to get into the housing market. What is the Minister going to do about it?

The hon. Gentleman is absolutely right in that analysis; I completely concur with it. It is a disaster for first-time buyers. One of the first things I did as Housing Minister was to reverse the policy of the previous Minister to say that I believe in the aspiration of people owning their homes. The reason we ended up with this problem in the first place is related to the enormous deficit and boom and bust, which was led by housing in particular. We need a more stable economy in placeā€”not like the one that we were headed for or like the Irish one, but one that is stable for the long term. That means that cutting the deficit is the No. 1 move. I am also very aware that there are effectively only five lenders on the high street, which means that there is very little competition for first-time buyers. The banking review will report next June. It is very important that competition is opened up and we reverse the situation for first-time buyers.