Budget 13: Osborne refuses to rule out buying second homes under MIG

Chancellor George Osborne has refused to rule out home owners purchasing a second or third home using the new Government-backed mortgage indemnity guarantee.

George-Osborne-Budget-2013-Parl-480.jpg

The flagship Budget policy, announced yesterday, is designed to target those struggling to buy their first home or move to a bigger property. It specifically excludes buy-to-let and interest-only deals but is silent on second homes.

It works in a similar way to the existing NewBuy scheme except it is not limited to new-build properties. It is set to launch at the beginning of 2014 and run for three years.

Osborne predicts it will give a £130bn boost to the mortgage market, leaving the Government with liabilities of £12bn.

Speaking to the BBC Today programme this morning, Osborne was asked whether you will be able to buy a second, third or fourth home under the scheme.

He said: “We are going to consult on the details but the mortgage market is an extremely complex thing. The intention of the scheme is absolutely clear, which is that it is for people who want to get their first home or have a home and want to move to a bigger home, because perhaps they have got a bigger family. We are working with the industry to get a scheme that works.”

Former Liberal Democrat Treasury spokesman Lord Matthew Oakeshott says he expects the Government to exclude second home purchases.