There's a strong argument that the Conservative Party's handling of Britain's housing crisis is why it finds its support at a 46-year low.Chancellor Jeremy Hunt has been warned his National Insurance cut won’t save his party’s fortunes For the Chancellor and his party, the stakes are high. This week, a poll suggested that support for the Conservatives had plunged to a 46-year-low, with the party trailing Labour by 27 points. After 14 years of Tory Government, voters appear fed up.
Interest rates plunged in the wake of the 2008 financial crisis, allowing investors and house buyers to take advantage of cheap mortgage deals. But a global pandemic and war in Ukraine sent inflation soaring; now, prospective homeowners are struggling to be approved for mortgages, while many who did manage to buy in recent years are now seeing their monthly payments surge, sometimes by hundreds of pounds.
These discussions have reportedly led to disagreements. On the record, Mr Gove has proposed stamp duty cuts and Government-backed 99 per cent mortgages, while also working to pass his embattled Renters’ Reform Bill – legislation that would ban “no-fault” evictions and offer renters greater protection – in the face of efforts of Conservative backbenchers to water it down.
Instead of a David Cameron and George Osborne-style flagship housing policy like Help to Buy , Mr Hunt is expected to announce a cut to the headline national insurance rate. The more people spend on housing, the less they spend on goods and services. Given that Britain needs to grow it’s GDP, this is less than ideal.
But it’s fair to say that, currently, there’s not much difference between Labour’s housing package and Michael Gove’s department. The Chancellor is not expected to unveil either of these policies tomorrow. There could, of course, be a last-minute change, a decision to throw young people something they can get excited about. But, given that big ticket items go to the Office for Budget Responsibility for assessment the week before the Budget is announced, this is unlikely.