The UK’s housing system is ‘fundamentally broken’ requiring wide-scale reform if it is to deliver fair and affordable housing in the future, said the Chartered Institute of Housing in a response to plans that could form the basis for the Green Paper into housing reform to be published later this year. CIH wants house buying to become simpler, with greater choice and more flexibility in tenure – and social housing should no longer be ‘populated by a majority of people unable to progress in their housing and wider aspirations’, it says.
The government has announced details of its £500 billion rescue package for the banking system. Making the capital available to eight of the UK’s largest banks and building societies in return for getting preference shares, the government is hoping to get the banks loaning to one another and kickstart the money markets again. Key points of the plan include making available £200 billion in short-term loans from the Bank of England, providing up to £250 billion in loan guarantees at commercial rates to get the banks loaning to one another, and having banks sign up to a Financial Services Authority agreement on executive pay and dividends.
But a number of analysts do not believe that the package will have much affect on the mortgage market. They fear that the extra money will only benefit those with a decent deposit of 25 per cent or more as the interbank loan rate – the Libor rate – is not tied to the base interest rate. First-time buyers and those with dodgy credit records will continue to struggle to find funding, or will have to pay significantly more for it. Even the anticipated cut in interest rates when the Bank of England’s monetary policy committee meet tomorrow is unlikely to be passed on to borrowers.
Falling house prices have caused a decline in the belief that property was the best way of saving for retirement. A survey by the National Association of Pension Funds found that one in five favoured property investments, down from one in four in February.
For the first time a housing association will include non-residents alongside existing customers in a decision-making body – giving them powers to shape the delivery of services. Midland Heart Housing, one of the largest housing associations in the Midlands wants members of local communities to have a say in helping shape the association’s policy and services.
And finally, an estate agent in Merseyside is naming and shaming tenants who miss their rent payments, by putting up signs reading ‘Rent dodger lives here’. The agency hopes the signs will embarrass tenants into meeting their rent, but promises not to target genuine cases of hardship. The legality of the signs has been questioned.