After the announcement in the 2014 budget the other day that the Help to Buy scheme would be extended to 2020, Ed Balls the Shadow Chancellor has spoken out against the scheme, claiming it could choke the economic recovery.
George Osborne announced on Wednesday that the Help to Buy scheme has helped thousands of people move into their own home who would not have been able to without the scheme.
He said he fears that as a consequence, mortgage rates will begin going up “earlier than they should” which could once again stunt the housing market.
The scheme has long been thought somewhat dangerous to the economy by some experts and politicians, and now Ed Balls has proposed an emergency “help to build” scheme to stimulate the building of new houses; 10,000 homes will be built under his scheme he claimed.
He feels that “the straitjacket of Osborne’s fiscal policy” will unbalance the housing market if more properties are not built, which is where his proposed scheme comes in.
He also wants the price cap of properties eligible for the Help to Buy scheme dropped from £600,000 to £400,0000 and for there to be stricter limits on who can apply, namely just the first time buyers for whom the scheme was designed.