Lack of ‘concerted energy’ to tackle UK housing crisis: Lenders live

The UK has all the tools to tackle the housing crisis, from government investment to ready and waiting developers, but Brightstar Financial & Sirius Property Finance Group Chief Operating Officer William Lloyd-Hayward says that it lacks “genuine, concise and focused energy to drive and deliver it”.

The comments were made after the The National Home Building Council (NHBC) reported last week that there was a significant increase in the number of new home registrations.

New home completions stood at 40,289 in the second quarter of the year, up 16% from the same period a year ago, bringing housing construction back to pre-pandemic levels.

He also revealed that the quarter also saw an increase in the number of new home registrations – the process by which builders register the land they intend to build with the body – to 66,855, up from 45%.

Speaking this week on Lenders Live on LinkedIn, moderated by Knowledge Bank Managing Director Nicola Firth, Lloyd-Hayward says all the latest stats are great, but “we have some simple levers that can be bought to really fix the housing crisis.”

“It’s not a crisis of recent years, we’ve had 12 housing ministers in 12 years, and probably 20 and 15 years. We haven’t had a concerted energy behind this in this country for over two decades.

“Each of us can help in this role, but we just need really consecutive energy to get things done. With any luck, these signs and inscriptions will result in 6,000 new homes being built next year – that will be great.

When the data was released, NHBC chief executive Steve Wood said: “At this stage we see no evidence that the cost of living crisis or recession risks are affecting consumer demand, while enrollment levels build continued trust within the industry. ”

Responding to the CEO’s comment, Lloyd-Hayward said: “I think that’s a general point. We are in the moment where everyone is anticipating and preparing a lot, obviously some people have been affected, but the storm is bigger and preparing.”

Speaking from a lender’s perspective, Tracie Burton, Senior Corporate Account Manager at HSBC, comments: “I was quite taken aback by this, but I think it’s really encouraging.”

“We still really need to do more in the new build space, especially get more creative with modern homes and also think about future generations so we can meet that demand. However, as Lloyd-Hayward said, there are some levers we can pull to solve this problem,” adds Burton.

Still on the same theme, the panel also discussed the latest figures from the government’s Loan to Value (LTV) program of 95%.

By the end of March, 7,966 mortgages had been taken out under the program.

It showed an increase from the period ending December 2021, when there were 12,388 mortgage completions under the scheme.

The latest statistics show that the completions of the launch of the program from April 19 to the end of March this year accounted for 6.5% of all residential mortgage take-ups in the UK.

But is the program enough on its own or will lenders need to gain confidence in the high LTV space to make a difference?

HSBC’s Burton suggests lenders will do more, “they will get the confidence they need to support this part of the industry, but it will work alongside government.”

“As our risk management teams have their discussions and discussions, we will gain confidence to go deeper into this larger LTV space.”

Meanwhile, the Harpenden Building Society’s Intermediate Sales and Distribution Manager, Emily Smith, says: “Before the pandemic, there were a lot of 95% mortgages and a lot of lenders involved. Lender proficiency was really high when it came to high LTV loans, but the pandemic hit and many lenders became more cautious, and rightly so.

Smith suggests ‘it’s tricky’ because ‘lenders don’t always like to be the first to say, ‘we’re doing this’, but it probably has to be the bigger lenders offering higher LTV loans rather than the bigger ones. small lenders.

Burton adds: “We can’t look at these things in silos, there’s a lot going on in the economy right now, so brokers and lenders have a duty to make sure we don’t over-commit our customers. common.”

“Along with that, while we want to do more to help customers who have larger LTVs, we need to make sure we don’t over-commit and look after them as well.”

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