Rishi Sunak is reportedly planning to relaunch Help to Buy, the £29bn government-funded equity loan scheme which critics argue inflated house prices, handed bumper profits to housebuilders and was mostly used by higher earners who didn’t need it. The policy is apparently being considered as a way to help first-time buyers at a time of high interest rates and distended prices. But there is a wealth of evidence that Help to Buy would only compound the problems in the housing market.
In 2013 the then Chancellor, George Osborne, was faced with an economy still in recovery after one of the longest and deepest recessions in living memory and a central bank that, following said recession, had suddenly become very skittish in its approach to credit. Osborne thought he had a solution.
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