Home ownership should no longer be seen as a long-term financial investment, Housing Minister Grant Shapps has declared.
Calling for a new era of stability, he said it was “horrendous” that house price growth had so outstripped earnings since the 1990s.
In an interview with The Observer, he suggested the Government could help to limit further price rises by encouraging the building of more homes.
He also apparently spoke of a “rational” market in which house prices fell in real terms, by increasing by less than earnings.
His comments will please would-be home owners who have been priced out of the market by the recent decade-long boom but may alarm people who have already invested in property.
“This government absolutely supports peoples’ aspiration to own a home,” he said. “But we also believe that (property) should be primarily thought of as a place to be your home.”
Mr Shapps, a Tory minister, described the enormous rise in prices between 1997 and 2007 as a “crazy period” which had left many younger people struggling to buy a home.
“I think it is horrendous that a first-time buyer would need to be 36 on average if they do not have the support of mum and dad,” he said. “The main thing everyone requires for their subsistence is a roof over their head and when that basic human need becomes too expensive for average citizens to afford, something is out of kilter. I think the answer is house-price stability.”
Liberal Democrat peer Lord Oakeshott said high house prices were a “curse for the young” and called for greater acceptance of renting.
“We must end our unhealthy British obsession with owner occupation for all,” he said. “We should make long-term renting, both fully commercial and in the social-housing sector, a flexible and accessible option as in Germany and Switzerland.”