Some builders will be excluded from scheme
Industry says new funding for homebuyers is not enough
The new money aims to support 5,000 homebuyers get on the housing ladder and will top up £35m already committed for the coming year.
Of the total, £80m will be directed at the established Open Market Shared Equity Scheme (OMSE) helping up to 2,000 eligible first-time buyers on low to moderate incomes.
The Help to Buy (Scotland): Affordable Home Ownership scheme will help up to 3,000 households next year, backed by £80m equity support towards the purchase price.
The three-year £195 million Help to Buy scheme, which will help thousands of lower income households buy a new-build home, will open for applications on 1 March.
Social Justice Secretary Alex Neil said: “I am delighted that we can help 5,000 home buyers into affordable home ownership in the coming financial year, underpinned by £160m, which is £35m 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.”
But Homes for Scotland’s incoming chief executive Nicola Barclay (pictured) noted that the funding represented a fall on previous allocations.
“Whilst £195m of funding has been announced for the next three years, the fact is that this represents a significant reduction on previous rounds,” she said.
The changes in criteria with reducing price ceilings means that some builders will be excluded from the programme altogether which may restrict supply in some parts of the country. Others will have to adjust their product mix to suit but this will only be feasible if local authority planning departments support and work with them to do so quickly and efficiently.
“Allocating more money to a scheme that has proved its value over a number of measures would have allowed its benefits to be maximised even further.
“Acknowledging that Help to Buy is one tool in the box, we will continue to press the Scottish Government for more support across the industry – from a streamlined planning system to attracting more people into our sector.”
Mr Neil said: “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 home building 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.”