Housing is in the spotlight like never before during the general election campaign with all parties promising big bold policies.
Chief among them are pledges from all parties to build more home in order to stop rocketing house prices. During the last year prices across the UK have risen almost 10% and politicians and policymakers do see this as sustainable.
On mortgage policy there are big divisions among the parties on how to help get people on the housing ladder and dish out mortgages.
The Conservatives are the party of Help to Buy which provides Government support to borrowers looking for mortgages with 5% deposits.
There are two parts to the scheme, which was launched in 2013, and the Tories want to extend part of the plan to 2020.
Labour and the Liberal Democrats have proven far more sceptical of the scheme and worried that it is artificially boosting house prices to dangerous levels.
Lib Dem business secretary Vince Cable has warned about the creation of a bubble while Labour Shadow Chancellor Ed Balls wants the maximum house price involved to be cut from the current £600,000 level.
Anyone looking to buy homes through Help to Buy could see the scheme radically altered depending on the make-up of the next Government.
Indeed there is much more concern with ballooning prices among Labour and access to homes for first-time buyers.
In certain areas the party has said it wants to restrict the sale of buy-to-let homes and allocate a certain number to first-time buyers.
This is a radical shift from current laissez –faire policy and would come as part of a wider crackdown on landlords by Ed Miliband.
In addition he would force local councils to create a register of landlords which would increase the rules and costs for landlords.
Buy to let lenders and landlords say this would push up the cost of buy to let mortgages as there are more risks of no-payment such as fines for poor housing.
There are also talks within the Labour party about whether to regulated buy to let mortgages, which are currently unregulated. This would create new rules around how landlords can get mortgages and would be again likely to push up the cost of mortgage rates.
Taxation
We can see how policies on first-time buyers and landlords would impact mortgage rates and availability but there is also a question of tax.
Labour is committed to introducing a charge of 1 per cent a year on homes worth more than £2m – dubbed a mansion tax.
Those earning less than £42,000 a year would be allowed to defer the cost until they die and Labour insists the threshold of £2m will rise in line with house price inflation.
The average cost of the charge on homes worth more than £2m would be £1,000 a month although Labour insists it would only cost £250 a month for homes worth between £2m and £3m.
Either way, this would have a drastic impact on mortgage availability as there would be much less disposable income for those buying high-end homes. It would also be likely to push up mortgage rates as lenders would be taking on more risk.
