'Good news' for first time buyers

RICS said it welcomed the additional £80m which will help first time buyers purchase newly built properties.

But it warned that its figures suggest up to 300,000 jobs could be lost in the construction sector, with serious implications for construction skills and housing supply in the future.

The government has extended support for vulnerable homeowners in financial difficulty by widening the eligibility criteria for the Mortgage Rescue Scheme so households in negative equity are no longer excluded.

The RICS Budget submission argued that the government must look at eligibility for the Mortgage Rescue Scheme, in particular for households in negative equity.

On the operational efficiency programme, RICS said that advice from both the private and public sectors can help bring about major efficiency improvements in the use of government property.

One of the key proposals is the introduction of a central property function to provide strategic support, it added. If this is to work effectively it must be led by experienced senior property professionals.

On the Homeowner Mortgage Support Scheme, RICS said that steps to help families stay in their homes and avoid the trauma of repossession are essential given the current state of the housing market and the prospect of a further sharp rise in the level of unemployment.

If these schemes are effective then there is a good chance that repossession levels will be lower than those predicted by many in the industry, it added.

Although the impact of the Homeowner Mortgage Support Scheme may be reduced by the decision of some of the major lenders not to sign up, RICS said ti is encouraging that a number of lenders who have provided finance to the more vulnerable parts of the community are planning to participate in the scheme.

Significantly, given current market conditions even those lenders who are holding back from joining HMSS will be reluctant to take on large numbers of repossessed properties which cannot be easily sold, it cautioned. As a result, many of them are already offering reduced monthly payments and increased levels of support without government intervention.