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The Scottish Government received a formal representation opposing the decision from Grampian Housing Association. A small number of other registered social landlords have also commented informally, some to support the Scottish Government’s decision and others to advise that the scheme had been popular with purchasers.

Registered social landlords (RSLs) may set up shared ownership schemes as long as they ensure good value for money and support for the sharing owner and provided that, in marketing the properties, they are careful to ensure that buyers fully understand what they are taking on. We would also expect RSLs to consider how this proposed activity fits with their overall purpose. In addition, the Scottish Housing Regulator and the Office of the Scottish Charity Regulator have recently issued joint guidance on what charitable RSLs need to consider when looking at any low cost home ownership initiative.

The independent evaluation of low-cost Initiative for first time buyers (LIFT) by ODS Consulting found that new supply shared equity, grants for rent and ownership (GRO) and shared ownership schemes have all contributed to creating mixed communities. We will therefore still be able to support mixed communities through shared equity funding. We will also highlight examples of good practice and lessons learnt in the creation of mixed and sustainable communities in our LIFT procedures.

ODS Consulting carried out independent research for the Scottish Government on four of the low-cost initiative for first time buyers (LIFT) schemes in 2010-11. The four schemes were new supply shared equity, open market shared equity, shared ownership and grants for rent and ownership. The evaluation focused on the outcomes achieved by these LIFT schemes, and looked specifically at six key areas:

Meeting people’s needs;

Allowing for mobility;

Affordability;

Additionality;

Mixed communities, and

Value for money

It involved a desktop review, telephone interviews with 151 individuals who had purchased properties through one of the LIFT schemes, and stakeholder consultations. A copy of the report can be found at:

http://www.scotland.gov.uk/Publications/2011/01/18143303/0.

It would be for the governing body members of the registered social landlord to ensure that they seek and follow independent advice from appropriately qualified individuals to help them make these decisions.

The independent evaluation by ODS Consulting identified concerns about how the shared ownership scheme met purchasers’ needs. It found that shared ownership does not offer the best value for money for either the Scottish Government or for the purchaser compared to shared equity schemes. A significant proportion of those sharing owners interviewed raised concerns about the scheme; with only half feeling shared ownership had definitely been the right option for them.

This information is not held centrally.

People buying a New Supply Shared Equity property from a registered social landlord must generally take an equity stake of between 60 and 80 per cent of the market value of the property. The grant provider may however agree to reduce the minimum equity stake to 51 per cent.

The independent evaluation of low-cost initiative for first time buyers by ODS Consulting demonstrated that in particular the shared equity schemes had delivered their objectives by meeting buyers’ housing needs. Whilst recognising that there are still some areas of Scotland where shared ownership was popular, the Scottish Government decided to focus its resources on those schemes which were effective in delivering key outcomes, such as helping first time buyers and delivering mixed communities; which offered the best value for taxpayers’ money; and which were shown to be most affordable to buyers.

This is likely to apply where a housing market is particularly pressured, or where people with particular housing needs have identifiable additional housing costs.