Steve Morgan, chairman of housebuilder Redrow has attacked the lack of mortgage availability for first-time buyers.
Morgan said: “Every week we are forced to turn away potential purchasers simply because they do not have a deposit of 25% or more; people with excellent jobs who under normal circumstances would easily qualify for a mortgage.
“For generations 95% mortgages have been the norm. Indeed the vast majority of existing home owners started out buying their first home with a mortgage of this size.
“Yet the current generation of first time buyers are being denied the opportunity that their parents and grandparents took for granted, simply because they are unable to secure an affordable mortgage with a modest deposit.”
Morgan’s argument is that it is impossible to have a buoyant UK economy without a healthy housing market.
“Each new home creates around six jobs, both directly and indirectly,” he says. Building an extra 100,000 new homes a year could create around 600,000 new British jobs, plus the associated tax revenues.
“At the very time when the country is in a housing crisis, the house building industry is working at little over 50% of the output of just a few years ago.
“Our message to the Government is simple: the regulators are going too far and the medicine risks killing the patient.
“Deliberately suppressing housing demand at the very time that the country has a chronic housing shortage is laying the foundations for the next boom/bust cycle.”