A flagship UK Government policy to revive the housing market has been questioned by a minister, raising fears it could lead to another property bubble.
Vince Cable, the Liberal Democrat Business Secretary, cast doubt on the Help to Buy scheme, which aims to provide equity loans of up to 20% for buyers of new-build homes in England and will part-guaranteeing mortgages for buyers across the UK from next year.
As soon as Chancellor George Osborne announced the scheme in the March Budget, fears were raised that, without a boost to the supply of housing, Help to Buy would push up prices.
Mr Cable said: "The proposal which hasn't yet been implemented, which is providing a guarantee for a limited range of mortgages, could be a problem. It could inflate the market. But, if it's properly designed, it could be a useful addition."
Under the scheme people will be able to buy a home with a 5% deposit; the UK Government will act as guarantor for a mortgage for an extra 20% of the value.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article