Sunday, May 22, 2005

New UK Plan Will Make Bubble Worse

At least one organization caught on to the new British proposal to subsidize first time home buyers. "Gordon Brown's scheme to help first-time buyers get cheap mortgages funded by taxpayers has come under fire from a leading housing charity."

"Housing charity Shelter today slammed the new plans, claiming they risk inflating the property bubble because more people will be available to buy, and squeezing the next wave of first-time buyers still further out of the market. We need to ask ourselves whether using government resources in wealth creation is the right thing to do because we certainly don't think it is."

The economic foresight stops there, though. Many people have convinced themselves that suddenly, the world has run out of land and houses. "They must adjust supply problems to make housing more affordable to those starting on the ladder. This proposal by Mr Brown to build 200,000 homes with this scheme is simply not enough. We need to look more at public housing."


At 12:22 PM, Anonymous Anonymous said...

Nothing is more effective at destroying a bubble than being told that your profits are illegal/immoral and should be socialized. Another reason for the NAR to talk this bubble down.

At 12:47 PM, Anonymous Anonymous said...

How is this different than affordable housing ordinances (which tax 'normal' housing to subsidize poor housing) and government loan handouts in California?

At 4:24 PM, Anonymous Anonymous said...

12:47 -- Socialism is socialism is socialism.


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