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Chancellor must step in to protect affordable local housing - Farron

April 14, 2009 2:23 PM

Local MP Tim Farron is calling on Chancellor of the Exchequer Alastair Darling to take action to protect the provision of affordable housing for local residents in the South Lakes. The current financial crisis is leading to banks restricting mortgage lending for properties with local occupancy agreements.

Mr Farron has worked extensively with Liberal Democrat councillors in the area to encourage property developers to build quality affordable housing in the South Lakes, with local people benefiting from successes such as the new development at Levens, built by private developer Russell Armer.

However, Mr Farron has been dismayed to hear from local developers that sales of new affordable properties have been hampered by banks restricting the flow of credit to those trying to step onto the property ladder.

Market-leading mortgage lender HBOS has insisted that borrowers chasing new-build properties provide a 20% deposit to obtain a mortgage, effectively pricing those seeking affordable housing out of the market.

Mr Farron MP said: "With the state now holding a majority state in many of the nation's biggest lenders, including HBOS, it simply isn't acceptable that those same banks are withholding mortgages from buyers just because the property is bound by a local occupancy agreement.

"Rural communities such as the South Lakes have worked tirelessly to encourage developers to engage in building affordable housing. The government needs to step in and make banks do what they were bailed out to do: lend to the people that need credit the most. If it doesn't, private investment could be driven away from the necessary work of providing locally-targeted affordable housing."