Help to Buy scheme has boosted northern economy

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A MORTGAGE LENDER says the Government’s Help to Buy scheme has helped to create a more positive business environment in the North of England.

Peter Hill, the new chairman of the Northern Association of Building Societies (NABS), said that the weight of Help to Buy activity has been in the regions and not London and the South East.

He said the average house price supported by the scheme is lower than the national average and dismissed concerns that Help to Buy is adding more fuel to the capital’s booming housing market.

The taxpayer-backed scheme has provided equity loans and mortgage guarantees to help kickstart housebuilding.

The chief executive of Leeds Building Society was appointed as chairman of NABS last month. The association represents 15 of Britain’s 45 building societies and has assets of £70bn, six million members and 500 branches.

Mr Hill said he is seeing signs of life in the northern housing market, with house price inflation most visible in the so-called Golden Triangle between Leeds and York, but the sector is “certainly not running away with itself”. He added that the overall market remains significantly lower than pre-crisis levels and policymakers have a lot more in their armoury to deal with some of the potential risks from an overheated property market in London.

Mr Hill was positive about the financial services sector in the North. He said Newcastle-based Virgin Money is good for competition and welcomed recent merger activity by Yorkshire Building Society to bring more head office roles to the region.

Mr Hill added: “You have seen one or two disappearing but then you see others coming along. The ones who have remained are thriving. I think the North provides an excellent base for businesses.”

He said the North’s financial services sector should not consider itself to be in competition with the City. He said: “London is a global capital. That is a great thing for regions within easy travelling time of London.”

He said the recent negative publicity surrounding the Manchester-based Co-operative Group was not representative of the wider mutual movement.

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