£8m to help first-time property buyers unspent

Millions intended to help first-time buyers has been left unspent. Picture: Ian Rutherford

SNP ministers unveiled a £40m fund last year for its shared equity scheme, which sees cash earmarked for buyers in return for a government stake in a property. However, £7.7m of the fund for 2012-13 was not handed out to first-time buyers.

Under the shared equity scheme first-time buyers get money in return for holding a security over the proportion which it funded. When the time comes to sell, the Scottish Government will receive the value at the time of sale of the percentage equity that is state-funded.

After Holyrood figures revealed the underspend, Tory finance spokesman Gavin Brown said: “This is a failure to support those aspiring to get on the housing ladder, and shows the Scottish Government did not do enough to make people aware and get them involved in this initiative.

“It has let potential homeowners down and Scotland deserves an explanation for this.”

The row came after it emerged that Scotland’s house-building crisis has deepened, with the number of homes being constructed at a 65-year low. There were 14,877 homes, including private and social housing, built in 2012. That is a drop of more than 42 per cent on 2007 levels and the lowest number since 1947, when there were 12,149 new-builds, according to figures from industry body Homes for Scotland.

The Edinburgh Solicitors Property Centre called on the government to do more to spread awareness of the shared equity scheme among first-time buyers.

ESPC business analyst David Marshall said: “It could be that a lot of first-time buyers have saved larger deposits and don’t need to use the scheme, whereas they did before. But whenever we’ve had first-time buyers’ evenings, when people are made aware of these schemes there is interest.”

Housing minister Margaret Burgess said the £7.7m “underspend on shared equity will be deployed in 2013-14 to support the Scottish Government’s overall investment in housing”.

A Scottish Government spokeswoman said: “We are doing all we can to help credit-worthy buyers to buy their first home or move up the property ladder.

“That is why last week we announced an additional £62m for our open market shared equity scheme over the next two years to help first time buyers to get a foot on to the property ladder.”