"That will spelt out in our manifesto". Photo: Getty
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Natalie Bennett's incredibly awkward interview with LBC

“Right, what – what we’re looking at, in terms of the figures here um – what we need to do is actually [silence] er… we’re looking at a total spend of 2. 7 [pause] billion…”

Today is the big day of the Green party campaign launch. So, naturally, the Green leader Natalie Bennett took part in a series of live radio discussions this morning about her party’s manifesto. What could have possibly gone wrong?

listen to ‘Incredibly Awkward Interview With Green Party Leader Natalie Bennett’ on audioBoom

Here’s a snippet of the interview, transcribed before this mole could listen no longer:

(Nick Ferrari – NF/ Natalie Bennett – NB)

NF - The third key theme is that the Greens will ensure everyone has a secure, affordable place to live – how would that be brought about?

NB- Well – a couple of things we want to focus on here. In terms of council housing we want to build 500,000 new social rent homes…

NF - Good Lord. Where will you get the money from for that?

NB- Well what we want to do is fund that particularly by removing the tax relief on mortgage interest for private landlords. We have a situation where private landlords at the moment… basically running away with the situation of hugely rising rents, collecting large amounts of housing benefits

NF- But how much would that be worth – the mortgage relief for private landlords?

NB - Erm, well, it’s, that’s part of the whole costing of all of this…

NF - The cost of 500,000 homes – let’s start with that – how much is that going to be?

NB - Right, well that’s erm... you’ve got a total cost um that will be spelt out in our manifesto…

NF- So you don’t know?

NB - [Inaudible response]

NF - No you don’t, right.

NF - So we don’t know how much those homes are going to cost but the way it’s going to be funded is mortgage relief from private landlords – how much is that worth?

NB - Right, what – what we’re looking at, in terms of the figures here um – what we need to do is actually [silence] er… we’re looking at a total spend of 2. 7 [pause] billion…

NF - 500,000 – 2.7 billion – what are they made of, plywood?

NB - Um, basically, what we’re talking about is 500,000 new homes and each £1 spent on these brings back £2.40

No – but what is the total cost of 500,000 new homes?

[Painful silence]

Painful indeed.

I'm a mole, innit.

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I was wrong about Help to Buy - but I'm still glad it's gone

As a mortgage journalist in 2013, I was deeply sceptical of the guarantee scheme. 

If you just read the headlines about Help to Buy, you could be under the impression that Theresa May has just axed an important scheme for first-time buyers. If you're on the left, you might conclude that she is on a mission to make life worse for ordinary working people. If you just enjoy blue-on-blue action, it's a swipe at the Chancellor she sacked, George Osborne.

Except it's none of those things. Help to Buy mortgage guarantee scheme is a policy that actually worked pretty well - despite the concerns of financial journalists including me - and has served its purpose.

When Osborne first announced Help to Buy in 2013, it was controversial. Mortgage journalists, such as I was at the time, were still mopping up news from the financial crisis. We were still writing up reports about the toxic loan books that had brought the banks crashing down. The idea of the Government promising to bail out mortgage borrowers seemed the height of recklessness.

But the Government always intended Help to Buy mortgage guarantee to act as a stimulus, not a long-term solution. From the beginning, it had an end date - 31 December 2016. The idea was to encourage big banks to start lending again.

So far, the record of Help to Buy has been pretty good. A first-time buyer in 2013 with a 5 per cent deposit had 56 mortgage products to choose from - not much when you consider some of those products would have been ridiculously expensive or would come with many strings attached. By 2016, according to Moneyfacts, first-time buyers had 271 products to choose from, nearly a five-fold increase

Over the same period, financial regulators have introduced much tougher mortgage affordability rules. First-time buyers can be expected to be interrogated about their income, their little luxuries and how they would cope if interest rates rose (contrary to our expectations in 2013, the Bank of England base rate has actually fallen). 

A criticism that still rings true, however, is that the mortgage guarantee scheme only helps boost demand for properties, while doing nothing about the lack of housing supply. Unlike its sister scheme, the Help to Buy equity loan scheme, there is no incentive for property companies to build more homes. According to FullFact, there were just 112,000 homes being built in England and Wales in 2010. By 2015, that had increased, but only to a mere 149,000.

This lack of supply helps to prop up house prices - one of the factors making it so difficult to get on the housing ladder in the first place. In July, the average house price in England was £233,000. This means a first-time buyer with a 5 per cent deposit of £11,650 would still need to be earning nearly £50,000 to meet most mortgage affordability criteria. In other words, the Help to Buy mortgage guarantee is targeted squarely at the middle class.

The Government plans to maintain the Help to Buy equity loan scheme, which is restricted to new builds, and the Help to Buy ISA, which rewards savers at a time of low interest rates. As for Help to Buy mortgage guarantee, the scheme may be dead, but so long as high street banks are offering 95 per cent mortgages, its effects are still with us.