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"The Chancellor wants to underwrite £130 billion of mortgage lending with state guarantees, in an attempt to help people struggling to buy a property.
"...Graeme Leach, Chief Economist at the Institute of Directors, has attacked the scheme and said:
"The housing market needs help to supply, not help to buy, and the extension of this scheme is very dangerous. Government guarantees will not increase the supply of homes, but they will drive up prices, at a time when it seems likely that house prices are already over-valued.
=When the scheme is withdrawn, any rise in prices that has taken place will be undermined, with potentially disastrous results. There is a real risk that the housing market will become dependent on the underwriting by government, making it very difficult politically to shut the scheme down."
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