The UK government is considering plans for cross-generation mortgages, according to a Sky News article.
The new plans would see homeowners take out 50-year mortgage terms to be passed on to their children when they die.
The Sky News article explains that the Japanese-style lending agreements could see people being able to buy a home with little or no expectation of completing mortgage repayments during their lifetime.
When asked about the scheme, Prime Minister Boris Johnson said he was “certainly” considering cross-generation mortgages, Sky News reveals.
The plans for cross-generation mortgages following a sharp decrease in net mortgage borrowing in April.
The Bank of England revealed that net borrowing of mortgage debt dropped from £6.4bn in March to £4.1bn in April.
Gross lending rose slightly in the month, however, from £26.2bn in March to £26.5bn in April.
Meanwhile, mortgage approvals for house purchases dropped from 69,500 to 66,000 and from a value of £16.8bn to £16.1bn.
At the same time, remortgage approvals fell from 48,700 to 47,800 but grew in value from £10.1bn to £10.2bn.
The government is already trying to include home ownership with a package of measures, according to the Sky News article.
Last month, Boris Johnson announced new measures to support more people to get onto the property ladder, including a comprehensive review of the mortgage market.
The Prime Minister set out the government’s commitment to reversing declining homeownership rates.
He also confirmed his ambition to “unlock the opportunity of home ownership” for more people through Right to Buy.
However, the new proposals were not welcomed by those within the industry with Shaw Financial Services founder Lewis Shaw describes the Prime Minister’s announcement as “the ultimate political meringue: sweet, lightweight and with very little substance”.
“Homeownership levels are lower now than they were in 2010, and we know that vast swathes of the right to buy houses have ended up in the hands of private landlords. We don’t need more right to buy schemes; we need to get more homes built and bring down the cost of buying and owning a home. Talk about fiddling while Rome burns,” Shaw comments.