The Labour Party has stated that it will secure a scheme that is designed to ensure low-deposit mortgages are available for first-time buyers, if they win the General Election.

The BBC has reported that the freedom to buy scheme will see the Government act as guarantor for part of a home loan, to encourage lenders to offer low deposits.

The mortgage guarantee scheme was introduced in 2021 by the Conservatives, when current Prime Minister, Rishi Sunak, was serving as Chancellor of the Exchequer, and it was extended until July by current Chancellor, Jeremy Hunt.

The Labour Party has said that its plan will help more than 80,000 young people get on the housing ladder over the next five years.

In a post on X, Labour leader, Kier Starmer, said: "After 14 years of the Tories, the dream of homeownership is out of reach for too many young people. With our freedom to buy scheme, my Labour Government would make it a reality again."

However, according to the Office for National Statistics, two in five (40%) people aged between 15 and 34 in the UK were living with their parents in 2022.

Mortgage expert at Quilter, Karen Noye, said: "Labour’s announcement last night of their “freedom to buy” scheme while headline grabbing is unlikely to have any significant impact to the housing market in the short term. In contrast, Labour’s pledge to build 1.5 million homes and overhaul the planning system could initiate far greater change. Addressing the limited housing stock in the UK is the key piece of the puzzle. By increasing the supply of new homes, it will make homeownership more accessible to a broader range of people.

"The freedom to buy policy aims to help young people get onto the housing ladder by making the mortgage guarantee scheme a permanent fixture. However, the well-meaning scheme introduced by the Tories, has so far been only marginally impactful.

"Regardless of Labour’s announcements, high mortgage rates continue to be a significant hurdle for lots of people.”

---