Tony Hazell 

Government helps high earners buy houses

Tony Hazell

Tony Hazell

How can people on incomes of more than £100,000 a year need help to buy their home?

To date, £8.3bn has gone into the Help to Buy scheme, which uses taxpayer money to fund a part of the deposit on a home. The scheme is supposed to help people on to the property ladder. 

You might have thought it was solely to help struggling youngsters who cannot raise a deposit to buy a small flat or starter home.

But it seems 6,939 families on incomes of more than £80,000 have used Help to Buy, while 4,795 on more than £100,000 a year have used it.

If someone is unable to raise a deposit when their household income is more than £100,000 a year, then perhaps they need to take a serious look at their lifestyle.

Less booze perhaps? Fewer holidays? Give up the recreational drugs?

So the question must be asked: Is this scheme now using taxpayer money to help stoke up house prices? 

While there may be evidence of property prices stalling in some areas, each of these almost 5,000 cases will be an individual home bought by high earners with government help.

Money must be repaid, but they will benefit from the gearing if house prices rise, as they inevitably will over the medium if not the short term.

There is growing evidence that those on higher incomes are getting far too much benefit from this scheme. 

The average household income in the UK is £37,370. Of the 158,883 properties bought using Help to Buy, 48,126 have gone to households with incomes of more than £50,000 a year.

While Help to Buy is well-intended, it is also benefiting those way outside its prime target area. These figures suggest it is time for a rethink.

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It is 30 years since polarisation introduced us to the independent financial adviser, yet here we are in 2018 and consumers are often still paddling in the dark when it comes to finding advice.

When somebody needs help with their money they ought to be able to go on to the internet and find a source that can lead them to the right adviser with the right qualifications.

Yet as British Steel workers discovered when looking for help with their pensions, this is not the case.

Now, finally, and with prompting from MPs on the Work & Pensions Select Committee, the Financial Conduct Authority is to begin an overhaul of its register.

Andrew Bailey, FCA chief executive, was honest in his assessment that the register was “created for a specific purpose that did not initially cater for consumers”.

Well that just about sums up the approach to regulation that was laid down by the appalling Financial Services Authority – an organisation so obsessed with belly-gazing and designing systems that it overlooked its twin objectives of protecting both the integrity of our financial system and consumers.

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