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Housing Minister calls for 30-year mortgages

By Joel Stanier

21 October2011

Grant Shapps, the Government's Housing Minister, has called for lenders to consider offering more fixed-rate mortgages of up to 30 years, in an attempt to encourage 'greater stability in the housing market', a Government website reports.

Speaking at yesterday's Building Societies Association's Annual Mortgage Seminar in London, Mr Shapps proposed the introduction of more 30-year fixed rate mortgage deals as a 'normal and sensible choice' for future homeowners, and said that a 'national debate' on long-term fixed mortgages is needed.

As things stand at the moment, few mortgages can be fixed for five years or more - and many of the deals that are available tend to be limited to those borrowing less than 75% of their property's long-term value.

Mr Shapps commented that longer-term mortgages will guarantee "people know where they stand", and allow families with tight budgets to work out just how much they'll be paying for their home in the long term.

He said: "While they won't be right for everyone, lenders should start to look at the case for 30-year mortgages and how we can move to a more stable housing market where first-time buyers can get their first foothold on the property ladder at a cost they know they can afford."

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Tags: mortgage, mortgages, BSA, Building Societies Association, fixed rate mortgage, longer term mortgages, property

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