Help to Sigh

Claer Barrett stirringly skewered the Government’s Help to Buy (her headline was Help to Cry – I’m just semi-plagiarising)  scheme in the FT last weekend. In London, apparently 15,000 first-time buyers applied to use the scheme in the last week.  For new dwellings, in London the scheme will lend 40 per cent of the purchase price interest free for five years for properties priced at up to £600,000.  The catch is that there seem to be only 61 new build dwellings where the scheme can be used.  Some of them aren’t complete yet – or even in London!  She identified the house building companies as the main beneficiaries of the Help to Buy policy.  I liked the comment of one reader who labelled the policy as “Help to inflate an already unsustainable asset bubble to new levels” – not exactly pithy but probably accurate.  Instead of taking away the bowl, the policy direction seems to be to put even more strong spirits into the punch.  This tends to make the evening better but the morning worse.  Although I’ve got some colleagues who’ve predicted 14 of the last three hangovers (I mean, housing market corrections).

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