Work begins on pilot scheme to help first-time homebuyers

The foundation of a new pilot scheme designed to subsidise home ownership for first-time buyers in the isles who are on low incomes was approved by councillors today.

Members of the services committee agreed an outline proposal for a shared equity scheme and more detailed work is now to be carried out by council staff on precisely how it would work. The idea of the council directly providing mortgages was ruled to be “unhelpful” and will not be pursued.

New local authority projects in Brae and at Hoofields, Lerwick, are to be used as a pilot. The SIC hopes that by acquiring a stake of, say, 30 per cent when a first-time buyer purchases a house, it would address the 857-strong waiting list and generate income to build more council houses.

A report from head of housing Chris Medley stated: “It is an alternative form of investment for the council, where the council is purchasing a share in a property and will be repaid when the property is sold, or the council share is bought by the purchaser.”

With the council part-funding the purchase of houses, incentives will be put in place to encourage house-buyers to buy out the council’s share “at the earliest opportunity” where possible.

Mr Medley said the scheme would have a range of social and health benefits for individuals and would also help the local economy, but he noted it would “require careful consideration to ensure that it properly targets the right groups and income levels”.

Further work was unanimously agreed by members, but a suggestion by North Isles councillor Robert Henderson to look at providing grants for people to build houses in more remote rural locations was ruled out on the grounds of cost.

Mr Henderson had pointed out that the proposal “seems to be mainly looking at bigger schemes” in already well-populated areas, which he felt would only serve to increase centralisation.

There was sympathy for his suggestion, but members agreed there was no money available for such grants. Lerwick South councillor Jonathan Wills said Mr Henderson’s idea was something the government “should be doing … but they prefer buying nuclear submarines”.

North Isles member Laura Baisley said it was good to see the scheme developing so quickly and it would be a case of “suck it and see – if it’s good we can roll it out elsewhere”.

While no other local authority in Scotland is pursuing such an arrangement, plenty of councils in England and Wales are doing so and North Mainland councillor Bill Manson thought it could prove to be a crucial crutch to “help folk onto the ladder at a much lesser cost”.

But Mr Manson wants the final proposal to establish the cost of homes the council would invest in to ensure it is purely for low-cost affordable housing rather than “folk trading up to a bigger house”.

Meanwhile, more needs to be done to ensure that new housing developments like the one at Quoys in Lerwick have adequate play areas for children, councillors agreed.

Lerwick South councillor Jim Henry said he had been approached by constituents concerned that the nearest play area to the housing development, at Sound Primary School, was too far away.

Fellow ward members Gussie Angus and Jonathan Wills were in agreement with Mr Henry after hearing from sports and leisure services manager Neil Watt, who said many children at Quoys did not have much in the way of a back garden to play in and were looking for a flat green area for sports and recreation.

During the committee meeting in Lerwick Town Hall, members agreed to recommend that the planning board insists on the provision of play area spaces at all new housing schemes.

Providing such spaces is important but need not be buttressed with “outrageously overpriced” equipment, pointed out Dr Wills. Councillor Laura Baisley agreed, saying children were much more likely to occupy themselves with a simple wooden log than with a variety of “elaborate” play apparatus.