Shared equity home ownership scheme launched in Perth & Kinross
Perth & Kinross Council has launched a shared equity home ownership scheme to help people get on the housing ladder, or to buy a house that better suits their needs.
The scheme gives people access to purchase housing at an affordable price in some new developments being built across the area.
The first shared equity homes under the scheme are currently available in a new-build development at Castleton, Auchterarder.
The council can secure housing units at a discounted price from developers, in compliance with their obligation to provide a level of affordable housing in any new developments.
For example, a one bedroom shared equity unit 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, take full title to the property and retain 70 per cent of the equity in the home. The council would retain the remaining 30 per cent equity balance share.
People eligible to buy a home under the scheme are:
- First Time Buyers (or 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 – People who can demonstrate their gross annual income is insufficient to purchase a property to meet their needs unaided on the open market.
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 per cent 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 the council’s 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.
“It will give a leg-up to first-time buyers who may not be able to afford to buy a home under normal circumstances, and to people who need to move home to suit their circumstances but can’t quite afford a new property.
“In many cases the council will retain affordable units that are built in new developments for social rental. However in some of the bigger developments happening across Perth and Kinross, the number of affordable units that are available to us is high. This means we can split them between social rental and this new shared equity scheme.
“This is an excellent way to give people access to the housing they need at an affordable price.”