A new initiative which will help people get a foothold on the property ladder in Perth and Kinross has been launched by the council.
The shared equity home ownership scheme in some new housing developments will help people purchase their own home at an affordable price.
The plan has been welcomed as it emerged earlier this month that Perth and Kinross is one of the least affordable parts of Scotland for buyers.
A ratio of 4.5 times a borrower’s income is regarded as the maximum that banks and building societies will lend but the figures showed the average property in Perth and Kinross is 6.6 times average earnings.
The new scheme works by the council securing housing units at a discounted price from developers as part of the developers’ obligation to provide an element of affordable housing on any new developments.
For example, a one bedroom shared equity house or flat with an open market value of £100,000 in a new development can be secured by the council for £70,000.
Under the shared equity scheme the purchaser would pay £70,000 for the property, the new owner would have full title to their new home but only 70% of the equity within the property. The council would retain the remaining 30% equity balance share.
People eligible to buy a home under the scheme are first time buyers, those with a significant change in household circumstances, or someone who is disabled and owns a house that no longer suits their needs.
People on a moderate income who can demonstrate their gross annual income is insufficient to purchase a property unaided can alos apply.
After four years property owners will be given the chance to buy-out the council’s equity share of their property, so that they own 100% of the property.
If a property is sold while the council still holds equity, the council will have a chance to buy it at open market value, discounted by their equity share. The council may then nominate a new purchaser who meets the shared equity scheme criteria.
Housing and health convener, Councillor Dave Doogan said: “This innovative new scheme is another way we can help local people into high-quality affordable housing and moreover into home ownership.”
Some 16 properties at Castlemains, Auchterarder are currently being built by Muir Homes and are available through the shared equity scheme.
All of the houses on the Auchterarder site are two-bed and two-storey properties; and a mixture of semi-detached, end terraced and mid terraced.
People can request further information on the shared equity scheme by calling 07810 856974 or emailing NMcCowanHill@pkc.gov.uk
