Tony Ward is chief executive of Home Funding
I’m a little worried that commentators are already judging the success or failure of the recent Government and Bank of England Funding for Lending scheme without giving it a fair hearing.
I’m not sure what good it will ultimately bring (but surely having this in place is better than having nothing at all) but realistically it is early days.
After all the scheme was only launched in August and it will take time for applications, never mind completions to flush through the system.
However already I have seen various comments from analysts suggesting that it will do little to help the first-time buyer market.
Moreover there are fewer deals around for higher loan to values than a year ago and this needs urgently addressing if we are to kick start the housing market.
It is a pity that non bank lenders and smaller banks and building societies will be unable to benefit from this scheme, particularly when those are the very lenders which are likely to be the ones to focus on the niche markets that we so desperately need to revitalise.
Perhaps this can be addressed in time and I urge the Government to think again about this omission if they are going to get the money where it is really needed.
Whilst I agree that we need more money to flow into key markets it is understandable that banks are being cautious.
Even with extra available funding they are still more likely to adopt risk averse behaviour and ration their lending to a smaller audience of borrowers as a means of conserving balance sheets.
So then it comes back to the question as to how we help those who have a deposit of less than 10% to put down?
It is true that there is an issue here. Average rents are increasing and we are locked in a spiral as more first-time buyers are locked out of the housing market so have to turn to the private rental market.
Maybe we should wait to see how the Funding for Lending scheme pans out.
Then if it really fails to deliver and has done little to help this target market we maybe need to think of providing new ways to fund these loans. After all the demand is there.
