Help to Buy will likely have the effect of pushing up house prices further, making housing become less – not more – affordable for young would-be-owners

The government’s Help to Buy scheme is intended to stimulate housing demand which, in theory at least, should translate into new housing being supplied. Christian Hilber argues that the UK housing supply is incredibly unresponsive to demand shocks, due to an extraordinarily inflexible planning system. The government’s attempt to boost homeownership will probably backfire, with the main beneficiaries likely to be mainly wealthy and older homeowners. A further concern is that exiting the scheme might seriously damage the economy and therefore be politically infeasible.