Curbing Help to Buy Will Choke the Regional Recovery

Curbing the Help to Buy scheme in an attempt to cool the frenzied London housing market will kill recovery in the regions, leading economists have warned.  The scheme has come under fire from critics fearful that the stimulus is artificially driving up London house prices and posing a threat to the UK economy. But only 7pc of the 842,000 mortgages approved through the programme over the last 12 months were taken out in the capital, according to experts at the Item Club. They concluded that curtailing the policy would therefore do little to rein in runaway prices in the capital. “Cutting the scheme could risk choking the recovery in housing transactions across the rest of the UK without solving any of London’s issues,” said Martin Beck, the Item Club’s senior economic adviser. “It would disproportionately hurt the areas where house price growth is much more modest – for example, the North East, where house prices rose by 2.9pc in the year to February 2014, compared to 17.7pc in London.” Read more on the Daily Telegraph website.