Scottish government announces schemes to assist 5,000 to purchase a new home
Posted 22 January 2016 by Keith Osborne
The Scottish government has re-launched the Help to Buy (Scotland) scheme with £80m of new funding and added another £80m to its Open Market Shared Equity Scheme, which it says will together support 5,000 households to buy a new home over 2016/17 financial year.
In all, Help to Buy (Scotland) has £195m of funding over three years, with new applications open from 1 Match 2016. Available only on new build home purchases, the scheme will offer a 15% equity loan on homes worth up to £230,000 in 2016/17, up to £200,000 in 2017/18 and up to £175,000 in 2018/19.
Social Justice Secretary Alex Neil says: “I am delighted that we can help 5,000 home buyers into affordable home ownership in the coming financial year, underpinned by £160 million, which is £35 million more than originally planned for this year. Importantly, this new funding is specifically targeted to support thousands of low-income individuals and families across Scotland get on or up the housing ladder.
“Since 2007, OMSE has helped over 6,000 first-time buyers who would not otherwise be able to afford to buy their first home to get a foot on the housing ladder; and this year we will help another 2000.
“Through Help to Buy, we have already helped 7,500 households buy a new build home and over the next three years our successor Help to Buy Scheme will help another 7,500 as well as boosting the homebuilding industry, and support jobs across Scotland.
“Homes for Scotland and the Council of Mortgage Lenders expressed clear views about how Help to Buy should be improved. We have listened carefully to what they told us and worked with them to develop the scheme to support industry and buyers as much as possible.
“The funding is also good news in particular for the SME sector of the housing industry. Hundreds of small developers will benefit from people buying new affordable homes across urban and rural Scotland.”
Homes for Scotland’s incoming chief executive, Nicola Barclay welcomes the news, saying: "As recent research confirms, the majority of Scots aspire to homeownership. The reintroduction of Help to Buy will enable more people to realise their dreams as well as keep the housing market moving. Providing builders with the certainty they need to plan their investment and construction programmes is crucial if they are to deliver the homes we need."
Allan Callaghan, managing director of Cruden Homes West, has reacted positively to the announcement: "The Help to Buy scheme helped many Cruden Homes first-time buyers take their first step on to the property ladder and today, Cruden warmly welcomes its successor which will act as a catalyst to support a new generation of Scottish homeowners for years to come.
"It's clear that the Scottish government has listened to the construction sector and our customers and considered the significant role that the Help to Buy scheme played in supporting stability and leading to job creation and economic growth. The impact of introducing a successor to this scheme will be felt across the sector - from larger operators with significant developments to those on a smaller scale.”
Andy Wyles, divisional managing director for Taylor Wimpey in Scotland, adds: “Initiatives such as these really do make all the difference to those who thought homeownership was well out of their reach, so it’s good news to learn of the return of this scheme for homebuyers because it hasn’t been available for a significant period of time.
“It’s also encouraging to hear of the three-year commitment from the Scottish government which sees funding in place until March 2019, which will give homebuyers more certainty of the availability of the scheme as they consider their future new home purchase.
“We are delighted that we will now be able to offer the Scottish government backed Help to Buy (Scotland) scheme which will help our prospective homebuyers make the move into their dream new home.”