The UK government gave away cheap money for property purchase deposits, which the wealthy abused, driving up property prices and leaving UK taxpayers exposed

In 2013, the UK coalition government of David Cameron's Tories and the Libdems' Nick Clegg launched a "Help to Buy" scheme that gave incredibly cheap, taxpayer subsidised loans to first-time homebuyers, who got their money interest free for five years and thereafter had to repay it at 1.75% interest.

Now, six years and billions of pounds later, the National Audit Office has published its report on the scheme, revealing that 63% of those who got free government money actually needed it to buy a house (4% of those who got the loans were on incomes of more than £100,000/year), and the net effect of flushing all these billions into the housing market was to massively drive up the cost of housing -- home prices in the UK have risen by an inflation-adjusted 35% since the programme went into effect.

Some of the abuses of the programme by the wealthy are just jaw-dropping: for example, in 2016 the Conservative MP Peter Boone bought a new house with a subsidised £35,000 loan that he took out in his wife's name.

This has all been great for developers, who have funneled much of the gains from the rise in new home buyers into their pockets, but it's a potential disaster for the exchequer.

Now that the housing prices in the UK have been driven up, and now that the British taxpayer has issued billions in loans for these inflated properties, the national treasury is in line to lose billions of housing prices decline and borrowers start defaulting -- say, if the British economy is destroyed by a precipitous, ill-planned move to leave the EU. Read the rest