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LONDON — Chancellor George Osborne has asked the Bank of England to play a bigger role in ensuring that his controversial “Help to Buy” housing programme does not cause a new property boom.

The BoE’s Financial Policy Committee (FPC) will make annual assessments of the plan, starting next September, the Treasury and the central bank said on yesterday (Sept 26).

The committee had been due to advise on the suitability of extending Help to Buy only after its first three years of operation.

The FPC will also advise whether a price cap for properties covered by the programme and fees charged to lenders are appropriate.

Help to Buy was originally launched to help buyers of new properties and a second, potentially much bigger phase is due to begin next January. It will assist buyers who might otherwise be unable to afford a down payment on a home. Up to £12 billion (S$24.1 billion) of government guarantees could spur as much as £130 billion of new mortgages.

Since the second stage of the plan was announced in March, Britain’s housing market has shown signs of recovery, especially in London, where prices have jumped by about 10 per cent from last year ago.

Critics of the scheme have said it risks fuelling an unsustainable rise in house prices. Britain’s Business Minister Vince Cable has expressed his concerns about the programme.

Properties worth up to £600,000 would be eligible for the Help to Buy as announced in March. Some critics have said that lowering the ceiling would help lessen the programme’s impact on properties in London where prices are highest.

Earlier this week, the FPC said it would be vigilant about risks from coming from the housing sector but said it saw no danger signs for the time being. REUTERS