LONDON, May 19 (Reuters) - Britain could scale back its “Help to Buy” mortgage guarantee scheme should Bank of England Governor Mark Carney advise it, Deputy Prime Minister Nick Clegg said.
Helped by an economic recovery and record-low interest rates, British house prices jumped about 10 percent in the 12 months to April, raising concerns that some buyers could be taking on too much debt.
Carney on Sunday gave his strongest warning to date about the risks of a housing bubble, saying the Bank of England was looking at new measures to control mortgage lending amid a shortage of home building.
“I think if he says that we need to pare back on some of the government schemes like “Help to Buy”, then I think we should do so,” Clegg told the BBC on Sunday, when asked about Carney’s comments.
“Help to Buy” helps people buy property with deposits as a low as 5 percent of the property price.
The state mortgage guarantee scheme was launched by the government last year, but the pace of the upturn in the housing market has led for calls that it should be scaled back. (Reporting by Sarah Young, editing by Guy Faulconbridge)