More Scottish Property News.

A £60m Scottish Government scheme which could help about 1500 first-time buyers on to the property ladder by lending them up to 40% of their mortgage was launched yesterday.

The initiative, which allows people to buy a home but only pay for part of it, is being rolled out across the country.

The open market shared equity pilot scheme had been in place in 10 council areas, but is now being expanded to all of Scotland. The budget has also been increased from £24m for 2008-09 to £60m for 2009-10.

Housing and Communities Minister Alex Neil said the programme would provide "a small but much needed boost to house sales in a number of areas across Scotland".

The scheme allows home buyers to pay for between 60% and 80% of a property with the Government taking on the rest, without any annual charge.

The Government would take back its proportion of the money when the property is sold on - or earlier if the buyer wishes.

Mr Neil said: "This scheme will help first-time buyers across Scotland to access the housing market. It will also help people who are struggling to sell their homes in the current climate by stimulating sales of properties in local housing markets.

"It is absolutely critical in two further respects: first of all it will provide assistance to about 1500 people in Scotland and these people otherwise wouldn't be able to get on the housing ladder.

"The second point is, as they buy their own home, many will come from rented housing, so they are actually freeing up housing for rent for others."

Those to benefit include Fiona Hunter, a self-employed hairdresser from Edinburgh who was only able to get her foot on the first rung of the property ladder at the age of 30.

She managed to buy her first flat, a £110,000 one bedroom property in Meadowbank, after securing 40% of the deposit through the scheme. She said: "I rented a flat in Edinburgh for a long time and really wanted to get on the property ladder but couldn't afford it.

"Even although some of the flats were coming down in price, it is still quite a lot especially if you don't have a deposit for the mortgage. One of my friends told me about this so I looked into it. It certainly makes a big difference."

The expansion of the scheme was backed by the Council of Mortgage Lenders Scotland and Homes for Scotland - the body which represents the house building industry.

Jonathan Fair, chief executive of Homes for Scotland, said: "The formal launch of the Scottish Government's £60m open market shared equity scheme, across the whole of Scotland, is a welcome and important step towards assisting first-time buyers to re-enter the market at this critical time.

"Encouraging and assisting sales of homes, including off-the-shelf new build as well as existing properties, has the potential to help reinvigorate Scotland's wider sustainable economic growth."

Kennedy Foster, of the Council of Mortgage Lenders Scotland, said: "Where there is demand for it, these schemes provide low to moderate income borrowers with housing choice and opportunity."

However, Shelter Scotland urged the Scottish Government to focus on building rather than buying.

Graeme Brown, director of Shelter Scotland, said: "We welcomed this expanded scheme as a way to support the housing market when the First Minister announced it.

"But we also expressed concerns about focusing on schemes that could mean would-be homeowners overstretching themselves to get on to the property market. This dream of home ownership, fuelled by over 200,000 households on waiting lists and not enough social housing, has been an integral factor in the housing bubble bursting and the current recession. Interest rates may be at an all time low which is currently good news for homeowners - but they aren't guaranteed to stay there.

"We continue to urge the Scottish Government to focus on building more affordable rented homes to ensure people have a real choice about where they live, without feeling forced into buying a home or overstretching themselves."