Boris Johnson announces new 5% deposit mortgage scheme for first time buyers

The Prime Minister has announced a new housing scheme for first time buyers which will let them get a mortgage with a 5% deposit.

Boris Johnson addressed the virtual Tory party conference today, saying that the scheme would help turn ‘generation rent’ into ‘generation buy’.

According to Mr Johnson, the plan would help to create two million new homeowners, although he gave very little detail about how the scheme would actually work.

BBC

In his speech, he said the Tory party needed to ‘fix our broken housing market’, by helping young people who struggle with deposits get their foot on the property ladder.

The PM also claimed he would ‘transform the sclerotic planning system’, making it quicker and easier to build new homes.

He added: “But these reforms will take time and they are not enough on their own.

“We need now to take forward one of the key proposals of our manifesto of 2019: giving young, first-time buyers the chance to take out a long-term, fixed-rate mortgage of up to 95% of the value of the home – vastly reducing the size of the deposit.”

“We believe that this policy could create two million more owner-occupiers – the biggest expansion of home ownership since the 1980s. We will help turn generation rent into generation buy.”

However, Mr Johnson gave very little detail about the plan, and didn’t confirm whether the government would underwrite these mortgages.

But according to the 2019 Conservative Party manifesto they: “[Pledge to] encourage a new market in long-term fixed rate mortgages which slash the cost of deposits, opening up a secure path to home ownership for first-time buyers in all parts of the United Kingdom”.