Highland Council is believed to be the first in the country to pilot a scheme which encourages property owners to sell directly to the council as soaring house prices and a rise in short-term lets continue to freeze out local people from the market.

As the council works to increase its affordable housing stock, the scheme has attracted interest from 130 sellers across Highland since January, with 40 properties now secured.

Allan Maguire, head of development and regeneration at Highland Council, said the scheme grew out of several requests from homeowners, some who had inherited a house from their parents, who wanted the property to be kept for the community.

Mr Maguire said “We decided to go for this hearts and minds approach and this campaign for homeowners to sell their properties straight to the council for market value.

Up to 1,700 jobs go unfilled on Scottish island as workers can't find homes

"People will sometimes say to us that their parents lived in the area all their lives and that they don’t want to sell it on the open market and then be used for an Airbnb.”

He added: “Rather than you selling the property and it then be used as a holiday home, we will pay market value for it but we will also not require a home report or for you to pay estate agents fees.”

The Isle of Eigg, where a property was sold directly to Highland Council in order to rent it to a teacher. PIC : Odd Wellies/Flickr/CC

Mr Maguire said the newly-acquired properties came at an “extremely challenging” time for the delivery of more affordable housing.

He said inflationary construction costs and a lack of contractors in Highland to tender for housing projects also a barrier were exacerbating the situation.

Mr Maguire said: “Construction costs have gone through the roof so houses that were costing us – including all fees and land costs – were costing us around £145,000 to build 18 months ago. That is now around £180,000 and more than £200,000 in parts of the West Coast.”

Portree on the Isle of Skye. The island is facing both a recruitment crisis and a housing crisis, with firms struggling to hire staff given the lack of affordable accommodation on the island. PIC: Markus Bernet/Creative Commons.

Up to £180,00 will be paid for a property, with it valued by the local authority or an outside professional. A higher price might be considered in certain cases.

Mr Maguire said: “We recently bought a bungalow in Badenoch for a family with specific needs for £250,000. If we had built a new house for them, it would have cost around £300,000.”

Key workers can also benefit in some cases, with a property acquired for a teacher on the Isle of Eigg. Most homes have been acquired in around Inverness and Easter Ross.

Last week, it was reported that a lack of affordable housing on Skye is impacting on businesses recruiting staff, with up to 1,700 positions going unfilled.

Allan Maguire, Head of Development and Regeneration Highland Council

"We haven’t been able to get as many properties on Skye, where we have bought around half a dozen. We can only go up to a certain price level,” he added.

According to estate agents RightMove, Highland properties sold for an average of £213,525 in 2021, up 7% on 2020 and up 15% on the 2019 peak of £185,110.

He added: “We will never meet the demand for affordable housing but this has been a successful project. We hope to buy up more properties as word gets out.”

'Hearts and minds' campaign in Highlands stops homes being sold for holiday lets