The Building Societies Association has become the latest body to warn that the Government’s Help to Buy scheme could create a house price bubble.
The BSA said it was ‘critical’ to have a clear exit strategy from Help to Buy’s mortgage guarantee scheme due to launch in January, which will give buyers access to 95% mortgages.
Paul Broadhead, head of mortgage policy at the BSA, said: “Care is needed to prevent the actions taken today inadvertently causing a distorted housing market in three years’ time – a market where State intervention has artificially hiked prices.”
In a quarterly survey, the BSA found that more than a fifth of first-time buyers who were questioned, said the best thing the Government could do is stop taxing their savings towards a deposit.
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