Helping people remain homeowners

The government must adopt a more "holistic approach" to boosting the housing market if remortgaging and home-ownership is to thrive in the future.

That is the conclusion of a report published by the Council of Mortgage Lenders (CML) which has identified a trend for "fuzzy" households and tenures where people dip in and out of the property and rental markets to suit their circumstances.

The study reveals the days of buying a home, moving up the housing ladder and then possibly downgrading to a smaller property at retirement are long gone as people make ever-more complex housing choices in their bid to become homeowners.

Investing in a buy-to-let property in an area of the UK with cheaper house prices while renting a home elsewhere is one common example of the "fuzzy" trend the CML has noticed.

But it also identified that remortgaging was becoming easier and mortgage products were becoming increasingly better designed, creating strong incentives for people to keep their money tied up in their homes.

In fact, the report found, people who wanted to remortgage were benefiting from better support and greater opportunity to cling on to their homes, even during challenging times.

Paul Samter, CML economist, said in the report: "The government has presided over an increase in home-ownership of 1.75 million over the past ten years. This has been supported by mortgage lenders who have developed products to help people into home-ownership who might previously never have been able to achieve it and to maximise their chances of remaining as home-owners if misfortune strikes."

He said, however, if the government was to meet its targets of boosting home-ownership by one million over the next few years they might face a big challenge.

He added: "Given the considerable complexities of modern life and the increasing interactions across tenures, perhaps it is time for the government to develop a more holistic approach to housing market issues.

"A good starting point would be to focus on policies delivering an adequate supply of high-quality housing units, assisting the mobility of households within and between tenures and an equality of treatment for those in need regardless of their tenure."