Budget: Housing loans will not be extended to buyers of second homes
The Government yesterday attempted to reject claims second-home owners could get state-backed mortgages under its flagship housing policy.
High levels of second-home ownership cause huge resentment across Devon and Cornwall, with critics blaming part-time residents for forcing up house prices and undermining local services.
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George Osborne's Budget on Wednesday unveiled state loans for deposits and mortgage guarantees to help hundreds of thousands of first-time buyers and "second steppers".
But yesterday morning, the Chancellor repeatedly ducked questions on whether the scheme could be used by purchasers looking for a second home.
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Housing Minister Mark Prisk later insisted it was "not the case" wealthy householders could use the scheme to buy a second home.
But Labour claimed in the Commons yesterday that page 39 of the Budget "red book" states the scheme is open to existing homeowners.
There are around 26,000 holiday homes across Devon and Cornwall. Liberal Democrat councillor Alex Folkes, who has campaigned to restrict second home ownership in Cornwall, said: "Liberal Democrats have worked hard in Cornwall to close the loopholes that give unfair advantages to second home owners.
"Cornwall cannot afford for Mr Osborne to undo all this hard work and so we need him to be clear that his new scheme will not subsidise second homes."
Stephen Gilbert, Liberal Democrat MP for St Austell and Newquay, hopes to raise a question in the Commons today.
He said: "It's very welcome that Government is doing more to stimulate house building and promote home ownership, but this help must be directed only at those who are struggling to get on the housing ladder and not those who seek a second home.
"We should be supporting aspiration from those who are priced out of the market or struggling to save for a deposit, not helping those who already have homes expand their housing empire."
Ed Balls, Labour's Shadow Chancellor, said: "Not only is George Osborne pressing ahead with a tax cut for millionaires it now seems that his mortgage scheme will help people to buy a subsidised second home worth up to £600,000."
But Mr Prisk said: "You would first have to divest your existing property prior to being able to proceed with any Help-to-Buy sale. This is about family homes. It is not about second homes. We do have details in there about making sure there is a legal declaration through a solicitor before someone can take on a purchase that they have got rid of their exiting property."
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