Perenna has called for the Labour Government to embrace long-term fixed rate mortgages as an addition to the mortgage market and remove the loan-to-income (LTI) cap.
According to analysis from the long-term lender, there are now 600,000 fewer homeowners on the property ladder than there should be, were homeownership rates the same as they were in 2010.
There are more than 1.5 million fewer homes owned with a mortgage compared to 2010.
Of these, 900,000 were found to own their home outright, and 600,000 more were privately renting.
House prices significantly outstripping wage growth and strict loan-to-income limits (LTIs) reducing access to mortgage finance have disproportionately affected young people.
There are approximately 380,000 fewer homeowners now aged between 25 to 44 than there would have been if homeownership rates remained the same as in 2010.
With this backdrop, Perenna proposed two major policy demands for the new Labour Government, urging it to embrace long-term fixed rate mortgages and to remove the LTI cap.
Arjan Verbeek, CEO of Perenna, said: “There are serious long-term consequences of more and more people and families unable to access homeownership, which will create issues in the future.
“The mortgage market needs new types of products that offer consumers more choice and can responsibly help them into homeownership earlier in life.
“Our call-to-action outlines clear solutions which offer hope that many people can become homeowners.
“It is essential that Labour unlocks the long-term fixed rate mortgage market to prevent another 600,000 missing homeowners”.
