RECENT ANALYSIS FINDS THAT THE HELP TO BUY SCHEME HAS ADDED TO THE INFLATION OF HOUSE PRICES
The government’s Help to Buy scheme has added to the inflation of house prices according to a recent analysis, Inside Housing reports.
The analysis of the Help to Buy Scheme revealed the following:
There was clarity from the start that demand-side subsidy of this kind would lead to a price and supply response
The number of subsidies that would cause price increases and developer profits was unknown
The Government’s problem with this scheme is whether it offers value for money and storing up risks for the market and tax payer
Someone in the treasury is devising a way of slowly winding down the scheme
The chief executive of Paradigm Housing Group, Matthew Bailes, said:
” … clearly, it worked well for developers, and for providers, it was largely neutral, and part of the game if you wanted to buy new stock.
“Arguably, it suited the Housing Corporation too, by helping it to achieve its targets while claiming to have squeezed grant rates.
“The only losers were the taxpayers and the people who would have been housed had the wasted grant funding been used to fund additional units. Unfortunately, they didn’t have much visibility of what was going on.”
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