Britain should more than halve the ceiling for its
housing scheme for first-time buyers, before it begins distorting the
market. George Osborne should slash the
£600,000 limit for properties qualifying on the Help to Buy scheme, and start
to scale back the mortgage subsidy scheme, according to OECD Secretary General
Angel Gurria. Last week, UK ministers said nearly 40,000 people had benefited
from the programme and used it to buy a house. However, critics of Help to Buy
have long said the scheme looks designed to win support for the government
ahead of elections in May 2015 and that it adds to the risks of a housing price
bubble. Gurria said that the government should lower the eligible house price
limit to the national average, £262,000, and also begin the process of winding
down the programme over about a year.
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