Over 6,000 seek mortgages under UK Help to Buy scheme

LONDON Thu Jan 2, 2014 8:54am GMT

A residential street is seen in Notting Hill in central London October 8, 2013. REUTERS/Toby Melville

A residential street is seen in Notting Hill in central London October 8, 2013.

Credit: Reuters/Toby Melville

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LONDON (Reuters) - Over 6,000 people have applied for mortgages under the British government's Help to Buy scheme in its first three months, which if approved would amount to 910 million pounds in loans, Prime Minister David Cameron announced on Thursday.

Presented by the government as a bold policy to help aspiring home-owners gain a foothold on the property ladder while stimulating house-building, the scheme has raised concerns among critics that it could fuel a property bubble.

"In less than three months, the scheme has already helped thousands of people. I want to see that continue in 2014 and for Help to Buy to help thousands more realise their dream of home ownership," Cameron said in a statement.

British lenders provided 45,044 mortgages for home purchases in November, more than in any month since December 2009, data from the British Bankers Association showed last week.

The Bank of England, which collects fuller data about the British mortgage market, said in November that lenders had approved 67,701 mortgages in October, a six-year high, although still below the pre-crisis average of about 90,000.

The Bank in November unexpectedly said it was ending its own incentives for banks to provide mortgages as part of the separate Funding for Lending scheme, which would instead focus exclusively on lending to businesses.

Bank Governor Mark Carney warned in December that Britain's housing market had a history of moving "from stall speed to warp speed", and one of the BoE's biggest challenges is keeping prices under control without holding back the rest of the economy.

The Bank and economists have also been concerned that the recovery relies too heavily on household consumption.

Data last month showed UK house prices rose 5.5 percent in the year to October, with London prices 12 percent higher.

Cameron and Chancellor George Osborne, both from the Conservative Party which leads the coalition government, have dismissed concerns about Help to Buy, which they say helps people with sufficient incomes to meet monthly repayments but who cannot afford the hefty deposits demanded by banks.

But Business Secretary Vince Cable, of junior coalition partner the Lib Dems, said last week the government should review the scheme in light of changing circumstances since it was conceived.

Cable spoke of a boom in house prices which he warned risk making large parts of London affordable only for wealthy foreigners and bankers.

Barclays and Santander banks are expected to launch mortgage products supported by Help to Buy later this month, joining RBS and the Halifax unit of the Lloyds Banking Group that have been involved since the start, and other participating retail banks.

(Reporting by Estelle Shirbon; Editing by Catherine Evans)

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Comments (2)
laodizea wrote:
I think what in truly bad in the UK it is NHS May be somebody is happy but doctors are really unprofessional and wicked .Particular psychiatrists I suffer tremor and restlessness after injections of Clopicsol. It is a pity to watch English patients paralysed and with tremor and they want to die in Switzerland after tremor. They do not realise that it is after medication I saw in internet thousands people suffer terribly after psychiatric clinic , There is no recover after this .It is good for Britain that I am not a king of Russia who I am otherwise I will put whole British embassy in psychiatric clinic to make them injections of Clopicsol until they will want to die after tremor You say anyway it is not dangerous Moreover I never was ill

Jan 01, 2014 12:51am GMT  --  Report as abuse
laodizea wrote:
Of cause in fact it is more complicated question about NHS Mental Health in California where I was cannabis is used for treatment of mental Health I never used I am not ill But I wonderfully understand that is it is true medication as opium etc Doctors say it is adductive and it is Truth but wicked Patients are received a life treatment with medication is it not the same NHS is corruptive and all knows and connects with criminal gangs. I was homeless and I am actually now. Streets of London are full with fags of all kind of drugs if you are a addictive you can collect a kilo a day. I do not want to intervene in British System but if people lose health that no money can buy than it is a trouble Suggest people Billion or trillion $ to be ill and you find not a lot if it is not a love to family or lover or friend otherwise people have no brain . If they are not proud of life because when there is no health you definitely want to die from physical sufferings. Otherwise you can be happy with you brain of cause if you are free Thanks to God and Jesus for brain but it does not work without health

Jan 01, 2014 2:35am GMT  --  Report as abuse
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