A Tayside property expert has criticised the Scottish version of the Help to Buy scheme for first-time buyers as not going far enough.
The Scottish scheme only applies to first-time buyers buying new-build properties, whereas England’s scheme does not have this restriction.
The Scottish Government is taking up to 20% equity in homes bought by successful applicants, making it easier for people with deposits as low as 5% to obtain mortgages.
Lindsay Darroch, partner and head of property at Blackadders, has called on the Scottish Government to open up the scheme further.
He said: “While I welcome all assistance to the housing market, I think the Scottish Government’s version of the Help to Buy scheme hasn’t gone far enough. It only helps first-time buyers purchasing new-build properties.
“I wish that they had done more analysis in terms of the numbers of first-time buyers in Scotland that actually buy a new-build property in my experience, very few, if any.
“I hope that they revisit their scheme and open it up to all properties and all buyers.”
Mr Darroch has also responded to criticism that lenders have set the interest rates of Help to Buy mortgages too high.
He said the scheme was not designed to introduce cheap mortgages but to increase the availability of mortgages.
“I have read a number of articles on the Government’s Help to Buy scheme with the commentators advising that lenders are not reducing their rates as part of the scheme,” he added.
“I think the articles are misguided as the point of the Help to Buy scheme is not to reduce the cost of borrowing but is in fact to make borrowing at higher loan to value more readily available.
“I think lenders are being very sensible in not making the cost of this too cheap but I hope that it is on the proviso that when interest rates start rising, in 2015 to 2017, mortgage payments in the Help to Buy scheme do not rise as quickly.”
Royal Bank of Scotland, one of the first lenders to offer products under the scheme, said it had taken 10,000 calls on mortgages since last week’s launch double the number it would usually expect to take.
The Help to Buy scheme has attracted criticism that a return to 95% mortgages could fuel another property bubble.