Prime Minister David Cameron says banks and building societies are being too cautious and are inhibiting the housing market.
Cameron says the UK’s housing market is vital to the UK economy and called on lenders to return to “respectable” lending in order to stimulate growth, according to a report in the Daily Mail.
He says: “In a way the pendulum has now swung too far the other way.
“If you are a single person, you are earning a decent salary. You go to the bank or building society, you are actually quite a good risk – they won’t give you 80 per cent of the value, they won’t give you four times your salary.”
He adds: “You need a housing market where people are able to sell and move.
“The housing market has become very stuck and we’ve got to get it moving again.”
Cameron’s comments come days after it emerged housing minister Grant Shapps is to meet FSA chief executive Hector Sants to discuss the mortgage market review.
In recent months, Shapps has repeatedly criticised the MMR for being too restrictive and suggested it would result in many people being unable to get on the property ladder.