UK Government encourages house buying in a falling market Wednesday, May 14, 2008
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.