Friday, February 1, 2008

More housing market intervention ?

Council gives £16,000 to first home buyers

A London council has launched a controversial scheme to give middle-income residents as much as £16,000 to help get them on the housing ladder. Conservative-run Hillingdon Borough Council hopes the initiative will keep “economically viable” workers in the local economy. It is not aimed at key workers or those already receiving government supportUnder the scheme, residents who have already secured a mortgage on their first home and have a minimum deposit of 7.5% will see their downpayment matched by the council. The only catch is they must remain in the property for three years, or face paying back part of the cash. The maximum value of the property is capped at £210,000.

Posted by jack c @ 03:42 PM (1338 views)
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12 thoughts on “More housing market intervention ?

  • mark wadsworth says:

    This is nuts. That £16,000 will just about cushion them against price falls over the next year. I’m all in favour of a bit of redistribution from rich to poor, but this is redistribution from average earners to average earners. And that from a Tory council *sigh*

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  • how about us, I want money now…. they should take it from the estate agents and give to poor…. not take from normal taxpayers who have been caught in this trap by labour… and by trap i mean houseprices shooting up… fueled by cheap money, labour party and estate agents pushing prices up..

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  • Why stop at Middle Earners? Why not give everyone an extra £200,000. This would really push the price of my house upward.

    Mmnn…..On the other hand…. Who is contributing this cash? Taxpayer/Ratepayer….that’s ME !

    Ok …..scrub the idea, then.

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  • European-bear says:

    Just helps to delay the crash in a bear market, or adds 16000 to the price of a starter home in a bull market. In any case it helps no one, just as tax relief on mortgage interest helps no one…it just inflates prices….

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  • This is just nuts. Do these people not get even the very most basic parts of economics…?
    All that will happen is prices will go up £16,000, making SELLERS not buyers better off.

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  • This scheme has been around for yonks – it is called Open Market HomeBuy and is one of the (many) stupidest things this Government has come up with.

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  • it_is_going_with_a_bang says:

    Sounds like vote buying to me.
    And politically very dangerous? What if prices dropped by 40k in the next year or so, then you would get people saying ” I wouldn’t have bought it unless those Tory councilors gave me the deposit and now ive lost thousands”!
    I know a Tory councillor in London, he is a mortgage broker aswell. Conflict of interest maybe??? Somewhere ….

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  • Sold My Soul To The Never Never Never says:

    Cowley in Uxbridge is within Hillingdon Council. My friends bought a flat there in 1988. Property values nosedived to less than half of what they purchased it for by the mid 1990’s. You’d need to live there a lot longer than 3 years to recoup your money.

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  • This looks like yet another ttempt at market manipulation. Oh dear, the property market is crashing – let’s think of a way to keep it up.

    The Government scheme to assist key workers is yet another example of an attempt to stop the market from crashing.

    I hope all attempts fail. How can a free market democracy exist without a free market?

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  • Wouldn’t this be like buying yet more votes? So Torys give away cash to middle earners to secure thier vote and labour give away tax credits to low earners to secure thiers.

    Thats vote rigging isn’t it?

    I guess more labour and tory MP’s have nice cushy advisory jobs at the helm of large banks should they lose thier seat, perhaps the banks are hedging thier funding. IT S CRIMINAL!

    And they have the nerve to lock up old grannies for not paying thier council tax.

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  • Remember this?

    http://en.wikipedia.org/wiki/Homes_for_votes#Building_Stable_Communities

    Aside from all of the good comments about the lunatic economics of subsidising private housing with taxpayer’s money there is considerable scope for corruption here. I hope this is a freak aberration – not the future of local government politics.

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  • autopilotengage says:

    “key workers” usually refers to those on the public sector payroll. On the one hand we have Gordon insisting on restraint in public sector pay awards, on the other we have these handouts to public sector workers. Public sector pay is such a valuable indicator for calculating the risk of inflation; how convenient these extra windfall payments aren’t counted whilst the rest of us are left to suffer this increase in housing costs without any relief. Add to that the generous final salary pension and less hours in many cases… I’m feeling less sympathetic towards public sector strike threats over pay all the time.

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