Mortgage and Rental Costs

Debate between Margaret Greenwood and Rachel Reeves

Tuesday 27th June 2023 Commons Chamber

[Rachel Reeves]

I thank my hon. Friend for that intervention. I will come on to the ways in which we can better protect people, but many banks are doing the right thing and trying to support their customers. It is important that all lenders take the action that is needed, which is why we need the Government to make that charter a requirement, not a voluntary agreement.

These devastating increases in mortgage rates will damage people’s plans for the future and deny many their dreams. In plenty of cases, they will mean more lives and hopes ruined. Citizens Advice said this week that many of its clients with mortgages have seen their finances “fall off a cliff”, with more and more people struggling to afford the essentials, such as food and heating. But it is not their fault: they have done nothing wrong.

For James, from Selby, the Tory mortgage bombshell is going to cost him and his family £400 more each month. That is nearly an extra £5,000 a year, but he cannot find that money and so he and his family have no choice but to sell their house and downsize. He has just told his children that they are going to have to start sharing bedrooms because they cannot afford to live in their home. Can the Minister explain why James and his family are having to pay the cost of this Tory Government’s failures?

[Margaret Greenwood (Wirral West) (Lab)]

My right hon. Friend is making excellent remarks. Does she agree that this situation is having a devastating impact not only on people with mortgages, but on renters, because landlords are passing on the costs to them? Does she agree that we need no-fault evictions to be scrapped immediately?

[Rachel Reeves]

I very much thank my hon. Friend for that intervention. She is absolutely right: the people being hit are those who are having to re-mortgage; those who are on floating rates and are just seeing their payments automatically go up; first-time buyers who want to be on the housing ladder but, because of this bombshell, are not able to get on it; and renters, who are paying the higher mortgage payments of their landlords. She is right to say that we need Labour’s renters charter, in order to do a number of things, including ending no-fault evictions.

Families facing the increasing squeeze from their rising mortgages are now having to confront that stress and anxiety day in, day out. For many, this will mean that their family holidays are cancelled this year; they will watch hard-earned savings drain away; and they will decide that they can no longer afford to spend money on days out with friends and family. For others, it could be much worse, with them not moving up the housing ladder, but slipping down it, through no fault of their own. The scale of the impact of all of this is devastating.