UK Government encourages house buying in a falling market

The FT's Westminister blog rightly highlights two obvious issues with the latest announcement from gaffe prone UK Housing Minister, Caroline Flint.

Caroline Flint has just announced a new £200m fund to buy unsold properties from desperate homebuilders and then rent them to social tenants.

By my calculations, that money could buy…..less than 1,000 average British homes.

In a country of more than 50m people, this is the equivalent of a finger in the dyke.

The government’s other measure to prop up the housing market is no more impressive.

It is - as I predicted in this morning’s FT - opening up shared equity schemes to more first time buyers. I hope, for their sake, the youngsters ignore this temptation - at least until prices have fallen by 10 per cent or more.*

* The government’s own prediction, as spotted on Ms Flint’s cabinet briefing notes yesterday.


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