Despite continued recovery in the UK housing market, a long-term vision and strategy is needed according to the Council of Mortgage Lenders (CML).
Speaking at the CML’s annual conference, chairman Nigel Terrington, also stressed the importance of the need for a planned exit strategy for the current Help to Buy scheme to stop any drift towards permanent intervention in the market.
In his speech, Mr Terrington highlighted that a long-term vision was required to create a sustainable housing market.
He said: “Where our customers have rational expectations of what their mortgage will deliver for them – which is a home – and not see housing debt as the long-term answer to all their financial needs. A market where intermediaries don’t veer from over-exuberance to over-despair at the shift of an interest rate. A market where lenders have business plans which temper short-term profitability with long-term sustainability. Where regulators understand that some rules and restrictions impose cost without protection.”
Mr Terrington added how the Government needs to implement and drive a more co-ordinated approach and more self-discipline is needed from the industry itself.
He said: “At least some of the characteristics of the market have their roots in the way in which the British have pursued home-ownership over the years – with a vigour that has at times bordered on the obsessional. I believe this is an embedded characteristic that would be foolish for the industry to challenge – although it does place a responsibility on all of us involved to ensure that our products, our services and our practices do not magnify – but rather temper – those characteristics.”
On the Help to Buy Scheme, Mr Terrington warned it should be a time-limited intervention rather than a permanent feature.
He added: “I don’t believe that it’s the intention for the scheme to rumble on for decades to come. We need tapering at the end of Help to Buy; not a cliff edge. This will not happen by chance and will require careful planning.”
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