Update on Help to Buy (Scotland) Scheme

The Scottish Government has recently announced that the price cap on properties eligible for the Help to Buy scheme will remain at £200,000 in 2018/19. The scheme helps eligible householders buy a new build home from a participating builder by contributing up to a maximum 15% equity stake in the property. The aim behind the Scheme is to help more families onto the property ladder.

The Government says that by keeping the maximum property value eligible for the scheme at £200,000 from 1 April 2017 until March 2019, the scheme will help as many people across as many geographic locations as possible.

“We want to help people get on or up the housing ladder and Scotland’s Help to Buy Scheme gives a helping hand to thousands of people” explained Housing Minister Kevin Stewart.”

“We want to make home ownership as accessible as possible- with a particular focus on helping people to buy affordable new-build homes.”

“We know, however, that prices of property-and what constitutes affordable- can fluctuate massively across different parts of the country,” he said.

“That is why I have decided to retain the price cap on homes across, urban, rural and small towns in Scotland.”

For expert legal advice on buying or selling property across Scotland then please contact me Alison Gourley on ajg@mitchells-roberton.co.uk or by phoning 0141 552 3422.

The Bank of Mum and Dad

The Bank of Mum and Dad apparently is now Britain’s ninth biggest “mortgage lender” putting it on a par with the Yorkshire Building Society. Parents are predicted to lend more than £6.5bn this year to help their children get on the property ladder.  This is a 30% increase on the £5bn loaned in 2016 according to recent research from Legal & General and economics consultancy Cebr.  This means that parents will be involved in more than 25% of UK property transactions as first time buyers continue to struggle to afford homes.

According to the report, the so called Bank of Mum and Dad will help fund property purchases worth about £75bn in 2017 including deposits for more than 298,000 mortgages. Parental assistance is expected to have risen from an average of £17,000 in 2016 to £21,600 this year. For those under the age of 35 the proportion seeking help from parents, friends and family for property purchases stands at 62%.

Nigel Wilson, the chief executive of L & G said “This is the second year of our bank of mum and dad research programme and the statistics show the problem is getting worse, not better.”

“The intergenerational inequality that creates the demand for (parental) funding continues to widen- younger children today don’t have the same opportunities that the baby boomers had, including affordable housing, defined benefit pensions and free university education.”

“Parents want to see their kids get on in life and the bank of mum and dad is a testament to their generosity, but it is also a symptom of our broken housing market.”

The surge in parental lending comes in spite of record low rates on mortgages, fuelled by intense competition between lenders for new business. But while mortgage repayments have never been more affordable, high prices in parts of the country mean first time buyers need large deposits to qualify for loans.

Government Urged To Remove VAT On Charitable Wills

Charity Consortium, Remember a Charity, has urged the UK Government to exempt VAT from the cost of writing a Will containing a charitable bequest.

The consortium predicts a VAT exemption on charitable wills would double the number of people leaving a gift to charity, generating a further £800m for the voluntary sector.

Rob Cope, Remember a Charity director, said “While this change would come at a relatively low cost to government, this could make a huge difference to charities, giving solicitors and will- writers cause to highlight the option and benefits of legacy giving with all clients.”

“We need to ensure that legacy giving is not just something reserved for the wealthiest in society; that it is something we are all given the opportunity to do.”

Legacy giving is a vital source of funds for charities and accounts for £2.5 billion of charitable income each year. Backing the recommendation is The Charity Finance Group, its head of policy and engagement, Andrew O’Brien said: “Legacies are a growing and important way that the public supports good causes. It is critical that we make giving as easy and effective as possible.”

Also supporting the move is the Institute of Fundraising, with its head of public affairs Mike Smith adding “This small change in the cost of writing a will could make a massive difference in the number of people who decide to leave a gift to charity.”

“The Government has been really supportive of efforts to increase legacy giving, and we are encouraging them to back this small reduction in tax to help raise millions for good causes.”

For expert advice on writing or updating a will then please contact Heather Warnock on hw@mitchells-roberton.co.uk or by phoning 0141 552 3422.