Help to Buy, where first time buyers' mortgages are guaranteed by the government, has so far been used by relatively few buyers, but may be more effective in helping to bolster expectations in the rest of the market. The scheme is playing a "supporting rather than a starring" role in the U.K. market at the moment, according to Nationwide, one of the U.K.'s biggest mortgage lenders.
"The scheme was designed to encourage high loan to value (LTV) lending.By the time it was introduced, lenders had already expanded their LTV terms, soit was answering a problem which was already being solved," Grainne Gilmore, head of UK residential research at Knight Frank, told CNBC.
Still, the potential for housing bubble history to repeat itself is not lost on policymakers or consumers. Expectations for house price rises have recently tailed off, according to estate agents Knight Frank.
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Outside the glamorous world of Chelsea penthouses, there seems to be a serious lack of supply. A decade ago, a flagship report by respected government advisor Kate Barker warned that 260,000 new houses needed to be built annually to keep house price rises at around 1.1 percent. Since then, housebuilding has averaged 115,000 per year in the private sector, and only 6 percent of housebuilders in the U.K. believe it would be possible to build even 200,000 houses each year, according to Knight Frank.
In the long term, there are hopes that London may be commutable from cities like Manchester or Birmingham, once a planned high-speed rail link is introduced. Until then, house prices remain relatively moribund outside commutable distance of the capital.