Help to Buy

[1] It was announced in Chancellor of the Exchequer George Osborne's 2013 budget speech, and was described as "the biggest government intervention in the housing market since the Right to Buy scheme" of the 1980s.

[16] It was rumoured at Davos 2014 the same month that Carney had been expressing a wish for the cap of £600,000 for phase two reduced by at least a third, partly to undercut the argument that Help to Buy was a major factor behind soaring prices in London.

[17] Regarding the capital, Carney said in February 2014 that price rises, which he said were constrained to the most affluent areas of the city, were beyond his control as governor, since they were driven by the cash purchases of the rich.

Instead of trying to pump-up prices, the Government should focus on relaxing planning laws and reducing Local Authority charges on developers to make it easier to build more homes.

[34] In Scotland, figures released by freedom of information showed that more than half of the homes purchased with Help to Buy were built by three volume housebuilders, prompting calls from [35] MSPs and housing charities to scrap the 'dysfunctional' scheme.

[42] At the end of November that year, as Mark Carney announced that mortgages and other consumer loans would not be eligible for his Funding for Lending Scheme from the start of 2014,[43] Nouriel Roubini warned of a housing bubble in London.

He said Help to Buy was simply "turbo-charg[ing] an already rising market inside London", where prices had reached "absurd" levels.

[46] A few months later, the Royal Institution of Chartered Surveyors urged that Help to Buy be regionalised, so that it would not contribute to what most of its members saw as unsustainable house-price increases in places like London.

[49] In mid-March, UK house prices rose to record highs,[50] though caution is merited,[51] and there were signs that the overheating in some areas was beginning to cool.

[55] Business Secretary Vince Cable expressed his disagreement with Hopkins, saying the gathering housing bubble could end up being worse than the one whose collapse resulted in the 2008 financial crisis.

[56] At the same time, the house-price gap between London and the rest of the UK was pronounced a new record,[57] and Deutsche Bank and others sounded more alarms about the situation in the capital.

[60] Despite the run up in prices in places such as London, Ian McCafferty, who sits on the Bank of England's Monetary Policy Committee, argued that the housing market had by no means fully recovered, because the number of house sales taking place was still below historic norms,[61] though increasing prices were predicted to at least partly cure the situation.