Katie Pender, managing director of Target Group, has called for the Government to urgently provide economic stimulus to the UK housing market to stop an implosion.
In a statement made today, Pender said the Government must step in and support a sector facing unprecedented pressures, as lenders continue to bear the brunt of macro market headwinds.
The call followed news of rising instances of mortgage fraud, alongside high levels of employment, inflation, interest rates, forbearance measures and no coherent support strategy from the Government.
Pender said: “The housing market is a lynchpin of the UK economy – if it continues going downhill, we will see grave consequences.
“UK householders are weathering rising costs thanks to the twin terrors of heightened inflation and interest rates, which has seen UK residential mortgages in arrears jump to a seven-year high by value.
“Forbearance measures are rising but there’s no end in sight, and no coherent strategy in place – it’s like the Government is hoping the problem will solve itself.
“Lenders are doing all they can, but we can’t just leave it up to them.”
She continued: “This is also not an issue affecting a small percentage of society – we’re talking about peoples’ homes.
“The Government stepped in to help with the energy crisis, and our industry needs a similar intervention.
“Lenders are doing all they can to support customers, but without a coherent, longer-term strategy set out by the Government, we’re storing up years of issues.”
However, Pender said resolution is possible, adding: “Without intervention the housing market will take years to recover, and those on forbearance measures – which are designed for the short-term – could be so financially impacted due to interest-only payments they store up credit issues for years to come.
“Long-term thinking can solve this; including increased stock to stop the market overheating, a review of social housing requirements and an appraisal of Brexit and Covid’s impact on the building industry, and how this in turn is affecting margins and costs.
“We could also look at tax strategies to support the most vulnerable. This might go some way to steadying the market and preventing these cyclical hot and cold streaks.
“We can’t compare this to 2008/9 – it’s a totally different set of circumstances, and to do so would be blasé. It’s time for action, otherwise we could see devastating consequences.”
