Call for action on mortgages, stamp duty and regulation

The CBI has called on government to take drastic action to ‘unfreeze’ the UK’s struggling housing market.

CBI director-general John Cridland said that improving the housing market would be a “major game-changer” for growth and economic recovery.

The organisation recommended that the government should stand by its beleaguered National Planning Policy Framework and retain its “strong pro-growth trend in order to build more homes”.

It also called on the government to reform stamp duty to make it more progressive and to reduce regulation holding back housebuilders.

In the short term it recommended rolling out mortgage indemnity guarantees, which protect lenders against default, freeing them up to accept lower deposits. It called on mortgage providers, house builders and the government to share in the risk.

The CBI also recommended measures to allow workers to borrow a percentage of their own pensions at a low cost to boost mortgage deposits.