LONDON, Jan 2 (Reuters) - Over 6,000 people have applied formortgages under the British government's Help to Buy scheme inits first three months, which if approved would amount to 910million pounds ($1.5 billion) in loans, Prime Minister DavidCameron announced on Thursday.
Presented by the government as a bold policy to helpaspiring home-owners gain a foothold on the property ladderwhile stimulating house-building, the scheme has raised concernsamong critics that it could fuel a property bubble.
"In less than three months, the scheme has already helpedthousands of people. I want to see that continue in 2014 and forHelp to Buy to help thousands more realise their dream of homeownership," Cameron said in a statement.
British lenders provided 45,044 mortgages for home purchasesin November, more than in any month since December 2009, datafrom the British Bankers Association showed last week.
The Bank of England, which collects fuller data about theBritish mortgage market, said in November that lenders hadapproved 67,701 mortgages in October, a six-year high, althoughstill below the pre-crisis average of about 90,000.
The BoE in November unexpectedly said it was ending its ownincentives for banks to provide mortgages as part of theseparate Funding for Lending scheme, which would instead focusexclusively on lending to businesses.
BoE Governor Mark Carney warned in December that Britain'shousing market had a history of moving "from stall speed to warpspeed", and one of the BoE's biggest challenges is keepingprices under control without holding back the rest of theeconomy.
The Bank and economists have also been concerned that therecovery relies too heavily on household consumption.
Data last month showed UK house prices rose 5.5 percent inthe year to October, with London prices 12 percent higher.
Cameron and finance minister George Osborne, both from theConservative Party which leads the coalition government, havedismissed concerns about Help to Buy, which they say helpspeople with sufficient incomes to meet monthly repayments butwho cannot afford the hefty deposits demanded by banks.
But Business Secretary Vince Cable, of junior coalitionpartner the Liberal Democrats, said last week the governmentshould review the scheme in light of changing circumstancessince it was conceived.
Cable spoke of a boom in house prices which he warned riskmaking large parts of London affordable only for wealthyforeigners and bankers.
Barclays and Santander banks are expected to launch mortgageproducts supported by Help to Buy later this month, joining RBSand the Halifax unit of the Lloyds Banking Group that have beeninvolved since the start, and other participating retail banks.
Barclays (BARC)
Lloyds (LLOY)
