Tory Minister calls for house price stability

Home ownership should no longer be seen as a long-term financial investment, Grant Shapps, the Housing Minister, 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 said the Government could help limit price rises by encouraging the building of homes. He also spoke of a "rational" market in which house prices fell in real terms, by increasing by less than earnings.

"This government supports peoples' aspiration to own a home," he said. "But we also believe [property] should be primarily thought of as a place to be your home." Mr Shapps described the rise in prices between 1997 and 2007 as a "crazy period". "It is horrendous that a first- time buyer needs to be 36 on average if they do not have the support of mum and dad. The main thing everyone requires is a roof over their head and when that basic need becomes too expensive for average citizens, something is out of kilter. The answer is house price stability."

Liberal Democrat peer Lord Oakeshott called high house prices a "curse for the young". He said: "We must end our unhealthy obsession with owner occupation for all," he said. "We should make long-term renting a flexible, accessible option."

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