Scottish government finds £30m to plug Help to Buy funding gap
The Scottish government found another £30m to fill the funding gap left after its Help to Buy scheme ran out of funds last year offering a big boost to small to medium-sized builders in Scotland.
Scheme funds ran out in July last year just three months after scheme launch.
However, 4,100 homes have been bought through Help to Buy (Scotland) in the last 15 months. The additional £30m for 2015-16, on top of the original £100m, will help a further 750 homebuyers.
The new scheme, badged the Scottish Government’s Help to Buy (Scotland) Small Developers scheme, will involve around 170 smaller developers.
Under Help to Buy (Scotland), the Scottish Government takes an equity stake of between 10% and 20% of the value of the property which can be repaid at any time.
The government website lists eight lenders as involved: Barclays, Glasgow Credit Union, Leeds Building Society, Lloyds Banking Group, Nationwide, Scotwest Credit Union, Skipton Building Society and Virgin Money.
During a visit to a new development in Leven, Fife, under construction by Campion Homes, First Minister Nicola Sturgeon said: “So this new support of £30 million will be ring-fenced to support purchases from 170 smaller building companies that develop thousands of quality homes across the country. These are often in remote locations and keep much needed jobs and skills in rural areas, while having a positive knock on impact on the wider economy.”
Pete Bell, chairman and managing director of Campion Homes, said: “The ring-fencing of the funds gives small and medium sized developers the confidence to progress developments which will be available for buyers taking up the Help to Buy (Scotland) Small Developers scheme.
“I am particularly pleased that the scheme is now restricted to houses costing a maximum of £250,000 as this will allow more first-time buyers to get on the property-owning ladder.”
Philip Hogg, chief executive of industry body Homes for Scotland, which helped shape the new scheme, said: “The Help to Buy (Scotland) scheme has been hugely successful, with proven demand demonstrating the aspiration of thousands of Scots to own their own home.
“The additional funding announced today is, therefore, warmly welcomed, and we continue to work closely with the Scottish Government to help address the challenges associated with planning and accessing development finance which also particularly impacts smaller builders.”
For more information, see the Scottish government website HERE.