Peter Williams, executive director of IMLA, said: "Any move to help first-time buyers onto the property ladder must be applauded as this is a sector that has been particularly badly affected by the credit crunch and subsequent mortgage drought. “However, the Government must see First Buy as one of a number of mechanisms to help the mortgage and housing market because it will have little impact in isolation. George Osborne estimates that this scheme will help approximately 10,000 borrowers, but that would only equate to a 5% rise in the number of loans to first-time buyers compared with 2010 numbers.
"We would like to see this scheme used hand-in-hand with other initiatives, such as a review of the Stamp Duty threshold. First-time buyers already benefit from 0% Stamp Duty on properties up to a value of £250,000, but the threshold for house movers should also be reviewed to encourage greater activity in this segment of the market.
"We would also like the Government to properly address the funding issue in the mortgage market. Although the Government has recognised the importance of the wholesale funding sector to the availability of mortgage finance, we have seen little in the way of support for this market.
“IMLA believes the Government can play an important role in supporting the securitisation markets, which will ultimately result in wider availability of mortgages across the board."
