A new Public First report finds that supporting more young people to afford their first home is fundamental to boosting housebuilding rates and reducing generational inequalities.

The report argues that weak housing demand from prospective buyers threatens the Government’s aims to boost housebuilding and economic growth. Public First’s First Time Buyer Index shows the proportion of young adults that are in a financial position to buy their first home is just 10.4%. Only 350,000 households have a high enough income and savings to get onto the housing ladder.

To boost rates of home ownership, housebuilding and economic growth, the report says the Government should help more young people to own their home by introducing a new equity loan scheme that is part-funded by industry, available for new homes and that lowers the deposit and affordability barriers to home ownership. Public First’s economic modelling demonstrates that introducing such a scheme would:

• Bring home ownership into the immediate reach of 490,000 more young people, widening the prospective first time buyer market by over 80%;

• Unlock the delivery of at least 19,700 additional new homes per year, which would be 98,500 new homes over five years and an 8% increase on the Office for Budget Responsibility’s recent forecast for net supply in England, helping the Government to achieve its 1.5 million new homes target;

• Generate £5.7 billion in additional economic activity per year, which would be £28.5 billion over five years, boosting growth and providing greater fiscal headroom for the Government;
• Position the Government as supporting home ownership, aspiration and hard work, while recognising the long-term benefits of home ownership for individuals, families and wider society.

Crucially, a new equity loan scheme would most benefit those people who cannot rely on parental wealth to save for a deposit, as well as those who are not on the highest incomes.

Opinion research conducted for the report finds this this policy would be popular with the public and particularly key voter groups:

• The public resents how home ownership has become a more and more distant prospect for younger generations – a large proportion of the public (76%) see this situation as “ridiculous”;

• 69% of the public support a first time buyer scheme that lowers the deposit to 5% for new build homes;

•  ‘Labour switchers’, those who voted Labour in the 2024 General Election but now say they would vote for another party, are the group most concerned about falling rates of home ownership and most supportive of a new equity loan scheme.

The report can be read in full here. It was supported by the Home Builders Federation.