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Could 50-Year Mortgages Be A New Option?

The difficulty of getting on the housing ladder for many is compounded by fears that such problems will also be passed on to the next generation, which has led to the floating of a possible new idea for multigenerational mortgages.

Prime minister Boris Johnson floated the idea at the start of the week, with the idea being that these mortages could be passed from parents to their children when they die, enabling costs to be spread not just over several decades, but to the next generation.

This type of mortgage is available in Japan, where home loans of up to 100 years can be obtained. It remains to be seen whether this is something that may be available to the average first-time buyer.

Mr Johnson told reporters in Madrid: “We want to find all sorts of creative ways to help people into ownership.”

The prime minister stated that while over 400,000 people had become first-time buyers in the past year, something he called a “great number,” it is “crucial for this government and for our overall economic story if those numbers continue to be strong”.

Some critics have dismissed the idea as failing to tackle the real issues around home ownership. Speaking to Sky News, Scott Taylor-Barr, financial adviser at Carl Summers Financial Services, said: "It is not the mortgage market that is preventing people from becoming homeowners; it is the cost of property in relation to people's earnings."

The comments from Mr Johnson came before this week’s maelstrom at Westminster, which included the resignation of Rishi Sunak and his replacement as chancellor by Nadhim Zahawi, as well as a mass of other departures that ultimately forced Mr Johnson to resign over new allegations about his honesty.

Assuming he remains in post under the next prime minister, it remains to be seen whether Mr Zahawi will favour the idea of 50-year mortgages.

For help with mortgages in Liverpool, get in touch with us today.

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