My Lords, I apologise for the delay—first day back and all that—but I will now move the amendments. Amendments 2 and 3 require qualifying first-time buyers to be a minimum age of 23 to be able to purchase a starter home.
As I made clear in Committee, the Government want to strongly discourage starter homes from being considered as commercial investment opportunities rather than homes to live in. Many noble Lords expressed concerns about the eligibility criteria for those able to purchase a starter home, including the possibility of such homes being used as an investment vehicle. One area of risk has been identified as parents buying starter homes in the name of young children, or even their young adult children who are not yet in a position to buy because they are not in stable employment but in higher education.
I listened carefully to the debate in Committee, and, as a result, we have tabled the amendment to introduce a minimum-age criterion that would limit the ability to purchase a starter home to those who are aged 23 or over. This would prevent individuals purchasing a starter home in the name of a child or perhaps a student under the age of 23.
We have considered the age that adult children leave education or training to enter the job market so as to become realistic first-time buyers in their own right. We estimate that about four-fifths of higher education students turn 23 either during their final year or after graduation. This minimum age requirement strikes the right balance between providing real opportunities for hard-working young people and families to secure a home and discouraging starter homes from being used as an investment opportunity.
My department’s analysis of Council of Mortgage Lenders data suggests that, in 2015, only 4% of first-time buyers were under 23. I expect that this minimum age requirement would directly impact a relatively low proportion of potential buyers, but would restrict the scope to game the opportunity provided by starter homes. I therefore ask that this amendment be agreed to.