First-time buyers ‘must be at the heart’ of the SNP’s housebuilding strategy over the next five years, the Scottish Conservatives have said.
Shadow Housing Secretary Miles Briggs’s call comes after price rises have spiralled in Scotland during the pandemic.
From March 2020 to August 2021, average property prices increased by 17% from nearly £175,000 to over £204,000. In Edinburgh alone, average prices have hit over £300,000.
However, during the Covid crisis, the SNP Government closed two crucial support schemes for first-time buyers. Help to Buy closed on February 5th and the First Home Fund shut for applications on 9 April.
First-time buyers in England can still access Help to Buy and also access shared ownership to help them on the property ladder.
The SNP Government have also failed to build the number of affordable homes for purchasing. Between 2016 and 2021, the SNP supported the building of 41,353 affordable homes, falling well short of their promise of 50,000 homes. Only a quarter of the homes were for purchasing.
The Scottish Conservatives are calling for a package of measures to help first-time buyers :
- Step up home building and encourage a higher portion of affordable new builds to be available to purchase for first- time buyers.
- Restore the Help to Buy scheme in full.
- Pilot a shared ownership model in Edinburgh where property prices are 48% higher than the national average to help first time buyers own a share of a property.
- Immediately increase the threshold for LBTT to £250,000 for first time buyers - saving them up to an additional £1,500 for a purchase
Scottish Conservative Shadow Housing Secretary Miles Briggs MSP, said: “More and more potential first-time buyers across Scotland are being edged out of the market as prices skyrocket. However, the SNP have closed off crucial supply lines of support that were previously available to them.
“The SNP have also resoundingly failed to meet their promises on building enough affordable homes. They are simply not on the side of first-time buyers and that must change now.
“Over the course of this Parliament, first-time buyers must be at the heart of our housebuilding strategy. Ministers should immediately restore the Help to Buy Scheme in full and raise the threshold for first-time buyers as to when they have to pay land transaction taxes.
“A generation of potential first-time buyers are at risk of being completely left behind by the SNP. Young Scots are missing out on the chance to own their own home as Nicola Sturgeon denies them the same opportunities available south of the border.
“The SNP have the money available to them from the UK Government to go further and faster in their housebuilding programme.
“The Scottish Conservatives are today setting out a real plan to support first-time buyers. It is time the SNP stopped putting a handbrake on so many individuals and families’ dream of home ownership.”
Notes:
- The average house price is now 17% higher than it was before the pandemic. Average house prices have increased from £174,907 in March 2020 to £204,176 in August 2021. In Edinburgh average prices increased from £259,138 to £301,233 over the same period, the second highest in Scotland, behind East Renfrewshire (Registers of Scotland, House price statistics, August 2021, link).
The SNP are failing to build enough homes for affordable ownership
- In 2016, the SNP promised to build 50,000 affordable homes over the next five years. ‘Over the next parliament, we will invest £3 billion to build at least 50,000 more affordable homes. 35,000 of these will in the social rented sector. We will also continue to support council house building. We will also support a further 5,000 households – including 2000 first time buyers on modest incomes – into home ownership through our Help to Buy and Shared Equity schemes.’ (SNP Manifesto 2016, p34, link).
- However, from March 2016 to March 2021 only 41,353 affordable homes were completed. To match their target the SNP would have had to have built, 10,000 homes per year which they never managed (SG, Housing statistics quarterly update: new housebuilding and affordable housing supply, 14 September 2021, link).
- Of these new affordable homes just a fifth were for ownership. Just 8,230 homes were built for purchasing through the Affordable Housing Supply Programme.
- In their programme for government, the SNP set a housebuilding target for 11 years in the future so that they could not miss it. ‘Deliver 110,000 affordable homes across Scotland by 2032, with at least 70% in the social rented sector and 10% in our remote, rural and island communities supported by a Remote, Rural & Islands Action Plan.’ (SG, PfG, 7 September 2021, p13, link).
- The SNP spent less than half of the £25 million that they allocated to the Rural Housing Fund. From 2016-17 to 2020-21 just £11.4 million of the Fund was spent (Scottish Parliament, Question S6W-01985, 19 August 2021, link).
The SNP cut funding for schemes to help new buyers onto the housing ladder
- The First Home Fund closed just five working days after it was opened this year and has been scrapped for good. The Fund provided first time buyers with an up to £25,000 government loan in their property. The Fund was introduced in December 2019 and was reopened on 1 April with £60 million (Scottish Housing News, 9 April 2021, link).
- From 5 February, the Help to Buy new build scheme was scrapped with no replacement. This allowed first time buyers and existing property owners to access support for up to 15% of a new build property (Mygov.scot, Help to Buy (Scotland) Affordable, 23 September 2021, link).
- In England, first time buyers can still access the Help to Buy scheme. Buyers can get a 20% loan of the purchase price of the property or 40% in London (GOV.UK, Help to Buy: Equity Loan, link).
- As a first-time buyer in England you can also purchase a property through shared ownership which does not exist in Scotland. This allows buyers to purchase between 10% and 75% of a property (Gov.UK, Buying through shared ownership, link).
- First time buyers in England do not pay any stamp duty on properties worth up to £300,000 (HMRC, Stamp Duty Land Tax: relief for first time buyers – guidance note, 8 March 2021, link).
- The Scottish Conservatives called for the Help to Buy scheme to remain open in our manifesto. ‘The SNP’s decision to end Help to Buy will damage the housing market and remove vital support for those unable to afford the full costs of buying a home. We will restore funding for the Help to Buy scheme’ (Scottish Conservative Manifesto 2021, p25, link).
The SNP have previously complained about Financial Transactions funding
- The total Scottish Government budget this year is the largest it has ever been. Taking pandemic funding aside, the Scottish Government budget is set to be over £44 billion, its highest ever level (SG, Budget 2021-22, 28 January 2021, p18, link).
- Former SNP Finance Secretary Derek Mackay described Financial Transactions Funding as a ‘con’. Mackay said ‘What I described as a “con” is some Conservative members’ having described the £2 billion as totally unconditional funding for the Scottish Government when, in fact, a large amount of it is financial transactions…the £2 billion has strings attached’ (Official Report, 8 January 2019, link; BBC, 22 November 2017, link).