There is no disputing the positive impact Help to Buy has had on Scotland’s housing sector. Introduced to make it easier for people to buy a new home, the Government provides up to 15 per cent interest free equity loans on properties up to £200,000.
The scheme, in which the Scottish Government has invested more than £500m over six years, effectively keeps buoyancy in a market where high loan to value mortgages can be prohibitively expensive for the many without weighty deposits. And so with the Scottish scheme set to end in 2019 and no decision yet made on an extension, housebuilders are wondering what impact this could have.
But the question must be asked as to whether public funds should still be used to keep this market growing when big builders are in strong net cash positions, in part because of Help to Buy.
If equity loans on set criteria were made a condition of major development projects then affordability issues could still be mitigated while driving volume to meet demand.
Groups such as McTaggart & Mickel have offered such deals in the past, so why not FTSE-listed builders now?
Public resources are under increasing pressure and the £508 million committed by Scottish ministers between 2013 and 2019 could have been spent overhauling the planning system to help meet demand while asking builders to address affordability.
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