The chair of NatWest has come under fire after saying it is currently not “that difficult” to get on the property ladder.
Speaking to the Today programme on BBC Radio 4, Sir Howard Davies said: “I don’t think it is that difficult at the moment. You have to save, and that is the way it always used to be.”
According to a recent report by Yorkshire Building Society, 2023 saw the fewest first-time buyers in the property market for a decade.
Sir Howard added: “I totally recognise that there are people who are finding it very difficult to start the process [of buying a property]. They will have to save more, but that is, I think, inherent in the change in the financial system as a result of the mistakes that were made in the last global financial crisis.”
The comments drew criticism from the campaign group Generation Rent, who said they were “astounding to hear from a senior banker”.
Ben Twomey, chief executive of the group, told PA Media: “What planet does he live on? We are in a cost-of-renting crisis that is making it incredibly hard for people to buy a home as we hand a third of our wages every month over to our landlord.
“Interest rates have increased but house prices have yet to correct, meaning we still need to save for a huge deposit, but also would need a high income to afford monthly mortgage repayments.”
Katy Eatenton, a mortgage and protection specialist at Lifetime Wealth Management, called Sir Howard’s comments “ludicrous”, and said the NatWest chair was “totally out of touch with reality”.
She added: “The cost of living is the highest it has been, rents are increasing year on year and house prices, interest rates and the lack of first-time buyer schemes are all adding to the difficulty in getting on the property ladder.”
Comments (3)
three quarters of a £M salary plus benefits, pipe down lord of the realm. Sheesh.
Great news, that means that average wage stagnation Vs inflation never happened. So average wages aren’t the equivalent of about £600 less per week today than they were in 2009, probably the single most significant factor in the cost of living crisis.
Or maybe the chairman is just a gaslighting fantasists?
“You have to save, that’s the way it always used to be.”
Yes, you have to save, but save for much longer and save much more.
I have four kids, only one can afford to buy because she was left some money by a relative on her mother’s side of the family. Two of the other three lived with us for as long as was possible (rent free), but when their personal relationships developed, quite naturally, decided to move out. They are now renting (not cheap!) and saving less.
Number four is still with us (he is 24) and saving as hard as he can. If he is lucky he might be able to buy a property later this year, but he had a setback recently when his much needed car cost him £1k to repair.
Not everyone is in a position to let their kids live with them rent free (my goodness they eat a lot!) until they reach their mid-20s, let alone give them a substantial amount towards a deposit.
Perhaps Sir Howard Davies could tell us where we are going wrong?