Builder pays 15% deposit to find first-time buyers for flats

The move by Linton Hay Properties is the latest in a series of moves by developers to overcome the sluggish property market.

The firm has brought 47 former holiday flats on to the market at a time when many buyers are finding it difficult to secure mortgages because most lenders will not provide a mortgage above 85 per cent of a property's value.

It has struck a deal with a building society that will allow it to pay the 15 per cent deposits required for up to a dozen of the one and two-bedroom flats on Murieston Road in Dalry.

It is thought to be the first time that such a deal has been offered in the Capital on properties that are not in new-build developments.

Selling agent David Alves, property manager at Edinburgh-based solicitor and estate agent Sturrock Armstrong and Thomson, said: "If you rent a one-bed flat it would be about 500 a month anyway, and you would also have to pay a deposit and probably a month's rent in advance. Here, all they'll need is around 700 for legal fees and that's them in.

"My generation had it lucky because they got grants for university and property was not as high priced in relation to income as it is now. There needs to be help for youngsters. Without enough first-time buyers, the market just won't be able to get going."

The Linton Court building was once a warehouse before being transformed into holiday flats around 30 years ago. The building was brought on to the commercial market last year but

work has now taken place to upgrade the flats, which start at 112,500 for one-bed flats and 139,500 for two-beds.

The 15 per cent deposit is paid back when the flat is resold, at which time it is independently valued and 15 per cent of the figure or selling price is given back.

Simon Rettie, managing director of Edinburgh-based Rettie & Co, said: "It is a relatively limited window. Developers want to move existing stock at a time when little is being built and, as there will not be many new starts in the near future, there will be limited availability.

"It means incentives like we are seeing now won't be around for long."

IT'S A BUYER'S MARKET

AMONG the deals being offered by developers in Edinburgh are:

MACTAGGART & MICKEL

Choice of free shopping deliveries for a year, assistance with legal fees or free white goods. Try for up to six months before you buy.

CALA HOMES

Plots of the week – heavy discounting on homes; Part-exchange schemes; scheme that guarantees the sale of current properties.

WESTPOINT

Buy a two-bed home from 22.19 a day with 75 per cent shared equity mortgage deal; part-exchange promise.