In a bid to further assist first time buyers to get their foot onto that first all important rung of the property ladder, the Scottish Government has expanded a scheme which means that buyers will pay from 60 per cent to 80 per cent of the value of the property which will be subsidised by an interest free equity stake…
[ClickPress, Sun Apr 05 2009] In a bid to further assist first time buyers to get their foot onto that first all important rung of the property ladder, the Scottish Government has expanded a scheme which means that buyers will pay from 60 per cent to 80 per cent of the value of the property which will be subsidised by an interest free equity stake…
Traditionally, first time buyers have needed all the help they can get so this scheme will help them as well as assisting people having difficulties selling their home due to the present economic climate.
The new scheme, which is worth £60 million, has been drastically increased from the original £24 million set aside to fund it. It is hoped that it will help more than 1,500 people buy their first property in Scotland.
The buyer can pay the Scottish Government a proportion of the selling price either before or during the sale and will not be responsible for paying any charges on the equity stake- a real bonus for first time buyers whose finances will likely be stretched enough as it is.
The Scottish Government would take back its proportion of the money when the property is sold on - or earlier if the buyer wishes.
The open market shared equity pilot scheme had been in place in ten council areas, but is now being expanded to all of Scotland.
The expansion of the scheme was backed by the Council of Mortgage Lenders Scotland and Homes for Scotland - the body which represents the house building industry. The Royal Bank of Scotland is also supporting the scheme.
The rollout began last year following a move from the Housing Minister for Scotland to introduce shared equity schemes with housing associations and also the extension of the “mortgage to rent” scheme to help people find their feet in getting on to the Scottish property market.
Scottish Housing Minister Alex Neill said, “This scheme will help first-time buyers across Scotland to access the housing market.
“It will also help people who are struggling to sell their homes in the current climate by stimulating sales of properties in local housing markets.
“It will provide a small, but much-needed boost to house sales in a number of areas across Scotland,” added Mr Neill.
Kennedy Foster, of the Council of Mortgage Lenders Scotland, said, “Where there is demand for it, these schemes provide low to moderate income borrowers with housing choice and opportunity.”
In England, the Council of Mortgage Lenders (CML) has called for greater funding from April’s budget to go towards expanding shared equity schemes, including HomeBuy Direct.
HomeBuy Direct is a scheme that aims to help first-time buyers who are struggling to get a deposit together to take out a 100 per cent mortgage for a new-build property.
The scheme was launched in September 2008, and enables borrowers to take a loan of 70 per cent of a property’s value from a mainstream lender, and make up the remaining 30 per cent with a loan from the Government and a property developer.
Housing developer Barratt says it has received 20,000 applications since the scheme began six months ago.
For more information on properties in Scotland and the market in general, please visit http://www.themovechannel.co.uk/property/Scotland/
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