Boris Johnson has revealed he wants lenders to offer super long-term mortgages as a way to get more people on the property ladder. The prime minister told reporters he was keen to find “all sorts of creative ways to help people own property”. No 10 is understood to be looking at ways to create a market for intergenerational mortgages, allowing buyers to borrow for 50 years – or longer – if descendants are signed up to inherit property and pay off the balance of the loan. The proposal would allow more people to buy a home in their forties and fifties, knowing they won’t have to pay it off in their lifetime. It could also allow more buyers to continue moving into larger homes if they are able to take out larger loans over longer time frames. Asked if he considered hypothesizing intergenerational loans that could be passed from parents to children, Mr. Johnson said: “Yeah, sure.” The prime minister also said he wanted to see more 95% mortgages, having pledged to turn “generation rent” into “generation buy” as part of the mortgage market review launched last month. “We need young people to have the confidence, to have the deposits, the mortgage packages to be able to own property,” Mr Johnson said. But housing experts warned that the idea of intergenerational mortgages was risky and would probably only be considered by wealthy people who could offer strong guarantees. “On the face of it, this seems like a great idea, but the problem remains that the loan will have to be affordable for all the original applicants as well as the children who inherit it,” said Graham Taylor of mortgage broker Hudson Rose. “Otherwise, children could risk inheriting a liability they can’t manage, which, when secured on your home, has devastating consequences,” he added. Japan created a market for mortgages with terms of up to 100 years in the 1990s in an attempt to boost its ailing property market. But Mr Taylor said they were seen as just “an inheritance planning tool for the rich”. Jamie Lennox, director of Dimora Mortgages, dismissed the intergenerational plan as “another smoke and mirrors idea that is unlikely to help the masses”. He said intergenerational mortgages would “only benefit people with more affluent families who have high incomes or large assets in the first place”. Urging the Government to build more homes, Mr Lennox added: “Until more homes can be built faster to tackle the supply and demand problem we have, the proportion of young people getting on the housing ladder will continue to fall ».
