The Edinburgh and Lothians Property Group (ELPG) believe that, although house prices are rising and mortgage lending is on the up in Scotland, first time buyers are still being hindered when it comes to being able to finance their first property purchase.
The group has said that new initiatives and funding should be made available for buyers at the lower end of the property spectrum, in order to further revitalise the market and allow encourage the recovery in property sales and prices to continue across Scotland.
Scott Brown, estate agency partner at ELPG member firm Warners, explains: "We're seeing some good recovery in the property market at the moment, with house prices rising and more properties being sold every month.
"However, although these signs are encouraging, many first time buyers are still finding it difficult to take their first step on the property ladder. Most require fairly sizeable deposits to put down on a new home and, if they do not have these in place, there are very limited options available to help them make a purchase.
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"As many first time buyers are young people who have to rely on help from relatives to secure the funds for their first home, there should be some new initiatives introduced to help the situation."
Mr Brown believes a more simplified method for parents guaranteeing a mortgage for their children would be benefictial as parents are more likely to be happy to stand as guarantors rather than to put down a hard cash sum for a deposit in the current climate. "If there were also attractive rates for these sorts of schemes and, potentially, a definite exit period for the guarantors then it would help to make it more attractive for parents to help and therefore easier for buyers to get their first step on the ladder, " he said.
The group also highlighted the Low-cost Initiative for First Time Buyers (LIFT) scheme run by the Government as another area that could be used to help more young house-hunters into the market.
Angus Macpherson, managing partner of Drummond Miller, said: "The Government has run scheme the LIFT for some time now and it has been a great success in helping to allow first time buyers who don’t have huge deposits in place to make a purchase.
"However, the problem with the scheme is that it runs out of its annual allowance of funds very quickly, meaning that many buyers are left disappointed. If the Government could find more money to put into the scheme, it would greatly help to encourage more first time buyers to purchase a property and – ultimately – will help the rest of the market."
The ELPG consists of five of Edinburgh's leading property solicitors – Warners, Neilsons, Drummond Miller, the Lints Partnership and Leslie Deans & Co. The group accounts for a quarter of all sales in the ESPC.
(GK/BMcc)
