Mortgages Scotland: Dream of home ownership is out of reach, says Scottish Labour

Scottish Labour say both the Scottish and UK governments need to step up their support for mortgage holders during the cost-of-living crisis

Scottish Labour has accused both the Scottish and UK governments of making the dream of home ownership out of reach.

New statistics from the Office of National Statistics show house prices rose on average by £23,929 between May 2021 and May 2023.

In the same time period, Bank of England interest rates went from 0.1 per cent to 4.5 per cent. Interest rates have risen again since, taking mortgage rates to their highest point in 15 years.

The dream of owning a home is no longer achievable, according to Scottish Labour.

The Bank of England says this means a huge number of people will be paying an extra £500 a month.

Scottish Labour, buoyed by success in the recent by-elections in England, are now accusing both Holyrood and Westminster of not doing enough to support people through the cost-of-living crisis.

Mark Griffin MSP, the party’s housing spokesman, said: “This bombshell has forced home ownership out of reach for thousands of Scots, but the Tories and the SNP are doing nothing to fix it.

“A double whammy of soaring house prices and interest rates has pushed mortgages through the roof and priced out potential first time buyers.

“What was once an aspiration will now feel like an impossible dream for many, but while they face these difficult times their governments are missing in action.”

Mr Griffin added Scots cannot be expected to weather this “perfect storm” alone, and have urged both governments to step up the support they are offering to homeowners with mortgages.

He said: “We need urgent support for those struggling with housing, coupled with long-term economic growth, to drive prices down.”

In response, Social Justice Secretary Shirley-Anne Somerville blamed the “economic mismanagement” of the UK Government.

She said: “The Scottish Government has repeatedly asked the UK Government to address this, and particularly to support those most impacted by high inflation, interest rates and living costs.

“We have provided almost £3 billion, both last year and this, for policies which tackle poverty and to protect people as far as possible during the cost-of-living crisis, including increased protection for private tenants facing eviction and the introduction of a temporary rent cap.”

She added: “We remain committed to making £3.5bn available for affordable housing over the current parliamentary session as part of our ambitious plans to deliver 110,000 affordable homes by 2032.

“The number of affordable homes completed in Scotland in the year to end March 2023 is the highest annual figure since 2000.”

A spokesperson for HM Treasury said the best thing to help mortgage holders and renters is to drive down inflation.

They added: “We have a clear plan to halve it this year, then get it back down to two per cent.

“The mortgage charter sets out targeted support measures for mortgage holders who are understandably anxious about high interest rates and the risk of losing their home.

“That’s on top of the £3,300 on average we are giving each household to help with the cost-of-living over this year and last.”