More criticism of George Osborne's Help to Buy Scheme. The Building Societies Association (BSA) has weighed in, claiming that it could help trigger another house price bubble.
Osborne's scheme has already been described as one of the "most stupid economic ideas" in the last 30 years by a leading City commentator. What are the concerns?
"Indentured servitude"Previously the boss of global strategy team at Société Générale, Albert Edwards, said he thought the Chancellor's flagship Help to Buy program could actually inflate property prices further, pushing more homeowner hopefuls into "indentured servitude". Now the Building Societies Association is having its own doubts.
"It [the Help to Buy scheme] cannot become a permanent feature of the market," says Paul Broadhead of the BSA, "beyond the time when the country is in economic recovery mode. 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."
Clinging onOf course we don't know where interest rates - now at a 300-year-low - will be several years ahead. Many recent British homeowners are just clinging onto home ownership thanks to low interest rates, though many are denied the better loan deals due to their smaller loan-to-value ratio.
Market distortionSo, do we really need the Government to artificially distort the market? "I believe it [Help to Buy] truly is a moronic policy that stands head and shoulders above most of the stupid economic policies I have seen implemented during my 30 years in this business," Albert Edwards said.
Meanwhile the BSA claims just one in five first time buyers (20%) says Help to Buy will help them. So what do the other 80% think? What about a climb in interest rates, helping fatten up their deposits while nicely flattening house prices to affordable levels?
What do you think?