The Committee is examining why it is becoming harder for people—particularly first-time buyers and those on lower incomes—to get onto, and stay on, the housing ladder.
Watch the evidence session here
The main barriers facing first-time buyers
Affordability pressures are being driven by three linked factors. Deposit requirements have risen sharply, with many buyers taking years to accumulate sufficient savings, especially for renters and those without family support. This challenge is more acute in higher-priced areas such as London and the South East.
On top of this, house prices have increased far faster than earnings. While wages have roughly doubled since the late 1990s, house prices have more than quadrupled. As a result, the typical home now costs several times the average salary, forcing many buyers to rely on dual incomes or abandon their plans altogether.
Stamp duty is a further barrier to homeownership and is an upfront cost for buyers. Where stamp duty holidays have been introduced in recent years, transactions have increased and properties have sold more quickly. Additionally, in April last year, the current UK Government didn’t retain the increase in nil-rate thresholds for first time buyers and for general buyers the nil rate of stamp duty was reduced from £250,000 to £125,000. Current reliefs do not reflect regional price differences, meaning some first-time buyers still face substantial upfront costs. We recommended more regular updates to stamp duty thresholds in line with house prices, and lower or flatter rates to reduce transaction costs and support mobility across the market.
What support is available—and where it falls short
Existing schemes such as Lifetime ISAs, First Homes, mortgage guarantee schemes and shared ownership can help, but they all have limitations.
We have raised concerns that the Lifetime ISA is not working as intended for everyone. Increasing numbers of people, often on lower incomes, are making early withdrawals and paying penalties, suggesting that cost of living pressures are undermining its effectiveness.
Shared ownership remains an important route into homeownership, but it has become less affordable over time. Property prices and deposits have risen significantly, and buyers often face the full cost of service charges and repairs despite only owning part of the property. Sensible reforms would include capping service charges or linking them to the percentage of the property owned, and reducing or removing staircasing fees.
Additionally, the existing Help to Buy Guide should be updated and information added about the latest home buying and selling reforms to raise awareness of available mortgage products, how to get on the housing ladder, and new rights under the reforms.
Mortgage products and lending rules
The UK Government should do more to help buyers through promoting the need for independent financial advice, ensuring they know their budget before viewing a property and understanding mortgage application timelines. We also support the creation of a First Time Buyer Decision Tool so people are able to calculate indicative costs and signpost them to where financial support schemes are available based on their circumstances.
High loan-to-value mortgages and mortgage guarantee schemes can help buyers access the market in the short term. However, they may not be sustainable in the long run and could expose buyers and taxpayers to risk if interest rates rise or house prices fall.
Recognising rental payment histories in mortgage applications could help demonstrate affordability, but this must be balanced against the administrative burden for agents and landlords. A simpler approach could be for buyers to use longer-term bank statements and tenancy agreements as evidence.
Housing supply alone is not a silver bullet
While increasing housing supply is essential, it will not automatically improve affordability unless new homes are delivered faster than demand, at lower cost, or alongside wider UK Government intervention.
Many would-be buyers are “rent-ready but mortgage-poor”: able to sustain monthly payments but blocked by deposit and lending rules. Addressing affordability therefore requires action on finance, not just volume.
Policymakers must also recognise that buying a home does not have to be the end goal for everyone. The UK Government must also focus on building houses with affordable rents that people can live in long-term as well as supporting First Time Buyers who take on an empty home or property that needs renovation through a new Renovation Fund.
Regulation of property agents
Across the UK, anyone can operate as a sales agent, regardless of qualifications, background, skills or experience. This can result in variable service levels for home buyers and sellers, including general bad practice, lack of financial protection and no effective way to resolve complaints.
When asked about regulation by MPs, Douglas said that it would provide greater consistency in the qualifications of property agents and of enforcement against, them as well support local authorities or Trading Standards teams across the country with specialist people, training and the right intelligence.
This would drive greater public confidence in agents and the wider market, help reduce fall-throughs, and support a change to the perception of home buying and selling as a highly stressful process.
