Section 5 - Home ownership and mortgage difficulties - The Moray ...

5. Home ownership and mortgage difficulties
In Moray, approximately 64% 1 of the population own their own home. Many people
want to own their own home but it can be difficult if you have limited financial
resources.
This section has information to help you become a home owner or to help those who
own their home but are at risk of losing it.
5.1 Buying or building a new home
5.1.1 Home Report
Although there are some exceptions, most properties marketed for sale in Scotland
must have a Home Report. A Home Report gives prospective buyers information
about the property before they make an offer.
More information on Home Reports is available online at
www.scotland.gov.uk/Topics/Built-Environment/Housing/BuyingSelling/Home-
Report.
A home report is made up of three documents; a single survey, energy report and
property questionnaire. These are explained in more detail below.
Single survey and valuation
A surveyor assesses and rates the accessibility and condition of a property. This
will include a valuation, which buyers can use to secure a mortgage, and an
accessibility audit for people with specific needs.
Energy report (and Energy Performance Certificate)
A surveyor assesses the property’s environmental impact, giving it an energy
efficiency rating and practical advice on how to improve the rating of the property
and save on energy bills. Properties are graded by bandings which allow buyers to
compare and identify which homes perform better.
Property questionnaire
The seller has to fill this in to give buyers helpful information such as Council Tax
band, available parking, service provider details and alterations that the seller has
carried out to the property.
1 Moray Housing Need and Demand Assessment – Table 5.1 Moray Housing Tenure Profile 2001
and 2010.
Updated: 04 December 2012 Section 5 Page 1

5.1.2 Buying a property
Finding a property
If you are interested in buying a property and want to know what is available, you
can:
Contact the solicitors or estate agents listed in Appendix B;
Read the advertisements in the following local newspapers which are
available from most newsagents or search online. Some newspapers have a
housing supplement:
Banffshire Advertiser out every Tuesday not available online
Forres Gazette out every Tuesday www.forres-gazette.co.uk
Northern Scot out every Friday www.northern-scot.co.uk
Press and Journal out every weekday www.pressandjournal.co.uk
and Saturday
Scot-Ads
out every
Wednesday and
Saturday
www.scot-ads.com
The Moray Solicitors Property Centre publishes a property journal every
month. You can get a copy by contacting them (see Appendix B) or visit their
website at www.spcmoray.com.
Check with developers in the area who may have a show home you can visit.
Buying sheltered or retirement housing
Sheltered or retirement housing is a development of purpose-built homes with
certain amenities. A development could be a block of flats, or could consist of
individual or linked bungalows. Some developments contain both. Amenities may
include communal facilities such as a lounge, laundry and guest bedroom(s).
In most developments there will be an emergency alarm system and/or the services
of a warden who may or may not be resident. The main duties of a warden are to
act as a good neighbour, summon help in an emergency and to make sure that the
common areas are looked after. Provision will be made for the cleaning,
maintenance and insurance of the communal parts. Services and amenities will be
paid for by a service charge.
You can search for sheltered or retirement housing online at www.housingcare.org.
You can also search on the Scottish Government website at
www.scotland.gov.uk/Housekey/RetirementHousing.aspx.
Updated: 04 December 2012 Section 5 Page 2

5.1.3 House prices and local variations
The following table shows median prices of residential house sales completed
during 2010 and 2011 by Housing Market Area (HMA) (housing search area).
Housing Market Area
2010 2011 % change
£ £
Moray 125,000 125,000 -
Buckie HMA 125,000 115,000 - 8%
Cairngorms HMA* - - -
Elgin HMA 142,000 125,000 -12%
Forres HMA 141,000 151,000 7.1%
Keith HMA 120,000 140,000 16.7%
Speyside HMA 124,900 117,000 -6.3%
Source: Scottish Government LHS Datapack: SASINES
* Not enough house sales to reach a valid conclusion for area
The number of house sales completed in Moray during 2011 was 1021, a decrease
of around 22% on the previous year. There was no change to the median price for a
property in Moray.
The areas with the biggest drop in house prices were Elgin (-12%), Buckie (- 8%)
and Speyside (-6.3%). The Keith area had the largest increase at almost 17%,
followed by the Forres area at 7%.
5.1.4 MI New Home
It can be difficult for people to buy a home with a mortgage, if they have not been
able to save enough of a deposit. The MI New Home scheme helps creditworthy
borrowers with a 5-10% deposit who meet the lender’s affordability requirements to
buy a new build property costing less than £250,000.
Find out if you qualify for the scheme and get details for participating builders on the
MI New Home website at www.homesforscotland.com/mi_new_home.aspx.
The scheme is expected to run until 31 March 2015.
5.2 Low-cost Initiative for first time buyers (LIFT)
5.2.1 New Supply Shared Equity
This scheme aims to help people on low incomes who want to buy a new home from
a Registered Social Landlord but who cannot afford to pay the full price. The
scheme is aimed at first time buyers but also aims to help those with a disability (see
section 8) or those affected by a change in circumstances such as a marriage
break-up.
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You will normally be expected to pay a share of between 60% and 90% of the price
of a property, with the rest held by a Registered Social Landlord using grant funding
from the Scottish Government. In most cases you will have the option to increase
your stake after two years.
You can get more information online at www.scotland.gov.uk/Topics/Built-
Environment/Housing/BuyingSelling/lift/FTBNSSES or contact:
The Scottish Government
HaRCCoG - 1st Floor
Longman House
28 Longman Road
Inverness
IV1 1SF
Phone: 0300 020 1200
Fax: 0300 020 1201
Email: housingsupply@scotland.gsi.gov.uk
5.2.2 Open Market Shared Equity
This scheme aims to help people who want to own a home but who cannot afford to
pay the full price on the open market. The scheme is aimed at priority groups who
are first time buyers such as social renters, members of the armed forces, veterans
who have left the armed forces within the past year, and widows, widowers and
other partners of service personnel.
You will normally be expected to pay for a share of between 60% and 90% of the
price of a property and the Scottish Government will help fund the rest. Your lender
may need a modest deposit. In most cases you will have the option to increase your
stake after two years, but you will not have the option to reduce your share.
There are limits on the prices of homes bought under the scheme.
You can get more information online at www.scotland.gov.uk/Topics/Built-
Environment/Housing/BuyingSelling/lift/FTBOMSEP or contact the following
Registered Social Landlord who operates the scheme in this area:
Grampian Housing Association Ltd
Huntly House
74 Huntly Street
Aberdeen
AB10 1TD
Phone: 0800 121 4496
Email: info@grampianhousing.co.uk
Website: www.grampianhousing.co.uk
Updated: 04 December 2012 Section 5 Page 4

5.3 Finding a site and building a property
5.3.1 Finding a site
Local knowledge is a considerable asset in finding and buying suitable sites on
which to build. Sites may be advertised in local newspapers, the Moray Solicitors
Property Centre, estate agents, solicitors and possibly in the Council itself. Some
will have outline planning consent for housing, some will be serviced with water,
electricity and gas, some will have neither planning consent nor services. Do not
buy a site until, at the very least, outline planning consent for housing has been
granted.
5.3.2 Taking the next steps and getting good professional advice
Anyone wanting to build a house has to overcome a number of official hurdles
before they are allowed to proceed to the bricks and mortar building stage. Even
before a potential house site has been identified, or as soon as possible afterwards,
you should get professional advice.
5.3.3 Planning permission and building regulations
Planning officials are more than happy to help anyone who is thinking of building a
house with specific advice on the requirements of the planning system and more
general advice on other aspects of the building process. They have useful
experience and would rather share it as early as possible to help potential housebuilders
to avoid some of the pitfalls and delays that can arise from not knowing
about what is needed to get planning permission.
The planning officials will explain their policies on the site, design and location of
any new house to be built in their area. They will advise on the requirements for
drainage from the house site, road access and water supplies and they will give
advice and assistance with preparing applications for outline and/or full planning
permission.
For more information contact:
Development Management
Environmental Services
The Moray Council
High Street
Elgin
IV30 1BX
Phone: 01343 563501
Email: development.control@moray.gov.uk
Website: www.moray.gov.uk (follow the link for environment and planning)
Updated: 04 December 2012 Section 5 Page 5

A Building Warrant will also be needed before work can start. Building Regulations
apply to all aspects of the construction of a new dwelling or to the alteration or
extension of an existing property. Once the Building Standards Officer is satisfied
that your proposals meet with Building Regulations, a Building Warrant will be
approved, allowing work to start on the project. Before you move into a new
property, or parts of an existing building that has been extended or renovated, it will
be necessary to have your Completion Certificate accepted, confirming that the
completed project complies with Building Regulations.
A duty officer is available for consultation each weekday between 2pm and 4pm,
either by visiting the Elgin Access Point or by contacting the Building Standards
Team on the details below.
Elgin Access Point
The Moray Council
10 High Street
Elgin
IV30 1BY
Phone: 01343 563243
Email: building.standards@moray.gov.uk
Website: www.moray.gov.uk (follow the link to environment and planning)
You can get and application form for planning permission and/or Building Warrant
visit from our website www.moray.gov.uk or your local access point.
5.3.4 Legal advice
You should get good independent advice from a qualified solicitor at an early stage,
particularly if you do not yet have legal title to the site.
5.3.5 Designing and building the house
Both the planning office and local solicitors can give you names and addresses of
architects and building contractors. It would be wise to ask family/friends for
recommendations. The "Yellow Pages" directory also gives names of the
manufacturers and suppliers of ‘kit houses’.
Some building contractors and all kit suppliers offer a range of designs which, if
suitable, may avoid or reduce the need to employ an architect. On the other hand,
an experienced architect will also reduce the amount of time and effort that you
would otherwise spend on overcoming some, or all of the hurdles, involved in
building a new house.
Updated: 04 December 2012 Section 5 Page 6

5.3.6 Self Build Guide for Scotland
If you are thinking of building a new home you may find a guide produced by the
Scottish Government helpful. It is available online at
www.scotland.gov.uk/Topics/Built-Environment/Housing/BuyingSelling/selfbuild/guide.
5.4 Buying your home under the ‘Right to Buy’ scheme
If you are a Council tenant (or in some cases, a housing association tenant) then
you may have a legal right to buy your home at a discounted price.
Your may not be able to buy your home if:
you became a tenant after 1 March 2011;
you have a short Scottish secure tenancy;
you live in a new build or new supply property (built or bought since 25 June
2005);
you have rent arrears or other housing related charges such as Council Tax,
water or sewerage charges;
we have served a Notice of Recovery of Possession on you;
the property has special features and/or housing support (for example, sheltered
housing);
your home has been marked for demolition; or
you are living in an area that has been granted Pressured Area Status because
of a shortage of affordable housing (this is explained in more detail in section
5.5.1).
The details of whether you have a right to buy your home are complex and depend
on when your tenancy started.
If your tenancy started before 30 September 2002
You have the preserved right to buy. This means you may qualify to buy your home
after two years. The minimum discount for a house is 32% and rises by 1% each
year up to a maximum of 60%. For a flat this starts at 44% after 2 years and rises
by 2% per year up to a maximum of 70%. You keep the original right to buy as long
as you stay in the same house.
If your tenancy started after 30 September 2002
You have the modernised right to buy. This means you may qualify to buy your
home if you have been a tenant for five years. For houses and flats the discount
starts at 20% after 5 years and rises 1% each year up to a maximum of 35% of the
market value or £15,000 whichever is the lower.
Updated: 04 December 2012 Section 5 Page 7

More information
If you are thinking about buying your home you should contact us for an application
form and a more detailed information booklet – these are available from your local
access point. Your filled in form should be returned to our Legal and Committee
Section. For more information contact us on 0300 123 4566.
You should be aware that the right to buy transaction – from the date of application
to the date of legal completion of the purchase – takes around six months.
Remember, if you sell your home within three years of when you accepted our offer,
you will have to pay back all or some of the discount.
5.4.1 Pressured Area Status
The purpose of a pressured area status designation is to protect the amount of
affordable rented housing and to make sure that there are enough houses for
people who need them.
The Housing (Scotland) Act 2010 introduced more flexibility and local control over
pressured-area designations giving local authorities the power to make, amend and
revoke pressured designations.
Before an area or property type can be designated as ‘pressured’, we must be able
to show that:
the need for social housing in the area is likely to exceed supply; and
this is likely to be made worse by tenants buying their homes.
The effect of Pressured Area Status
A pressured area designation suspends the ‘Right to Buy’ for the following tenants:
tenants who have taken out a new tenancy in the area on or after 30 September
2002 (the date of the introduction of the Scottish Secure Tenancy);
tenants whose tenancy was created before the introduction of the Scottish
Secure Tenancy who did not previously have the right to buy entitlement; and
tenants who have succeeded a tenancy following 30 September 2002 (unless
they were a level one successor). That is a spouse, joint tenant or co-habitee
(providing the house has been the co-habitee’s sole or principal home for six
months prior to the tenant’s death). In all cases, the house of the deceased
tenant must have been the only or principal home of the qualifying person.
Tenancies created before the introduction of the Scottish Secure Tenancy and
which were converted to the Scottish Secure Tenancy will not be affected by the
suspension as long as:
Updated: 04 December 2012 Section 5 Page 8

efore 30 September 2002 they had a Right to Buy entitlement as a result of
having a secure or assured tenancy with the preserved right to buy; and
they have not succeeded to their tenancy after 30 September 2002.
Which tenants does it affect?
Essentially all tenants who have the modernised Right to Buy will have their
entitlement suspended. It does not affect the rights of tenants with the original right
to buy (except for tenants who have succeeded to the original right to buy after 30
September 2002).
Any tenant who has started a new tenancy in the area will be covered by pressured
area status designation. This includes tenants who, after 30 September 2002:
transfer from another house owned by us or another registered social landlord;
mutually exchange their home; or
succeed to their tenancy (if they are a level two or three successor. That is they
are a member of the deceased tenant’s family who is aged 16 years or a carer).
Length of suspension of the Right to Buy
The pressured designation allows for a suspension period of ten years or less.
Although ten years is the maximum period, we may decide on a further period of
pressured designation, if we feel that it is necessary. We will assess each area
individually.
Areas granted Pressured Area Status
The locations on the next page have been granted pressured area status.
Updated: 04 December 2012 Section 5 Page 9

Housing market area Town/area Properties affected Right to buy
suspended until
Buckie Buckie – Buckpool All 26/01/2016
Buckie – Central 1 bedroom and 4+
bedroom properties
only
Cullen
Lintmill
Findochty
Portessie
Porgordon
Portknockie
Rathven
05/03/2022
Cairngorms Tomintoul All 17/05/2015
Tomnavoulin
Elgin Burghead All 26/01/2016
Duffus
Elgin
Hopeman
Lossiemouth
Clackmarras 1 bedroom and 3+
bedroom properties
only
Fochabers
Garmouth
Lhanbryde
Miltonbrae
Mosstodloch
Urquhart
05/03/2022
Forres Forres All properties 16/02/2014
Alves 26/01/2016
Brodie
Burghead
Dallas
Dunphail
Dyke
Findhorn
Half Davoch Dunphail
Kinloss
Rafford
Keith Drummuir 1 bedroom and 4+
bedroom properties
only
Fife Keith
Keith – Central
Newmill
Rothiemay
05/03/2022
Speyside Aberlour All properties 17/05/2015
Archiestown
Craigellachie
Dufftown
Glenallachie
Glenlivet
Knockando
Marypark
Updated: 04 December 2012 Section 5 Page 10

5.5 Mortgage arrears or payment problems
If you are finding it hard to keep up with mortgage payments then you should try to
discuss this with your lender as soon as possible. Repossession is a last resort, so
you may be able to reach an agreement as to how you will address the arrears.
5.5.1 Get free independent advice
You could be at risk of losing your home if you fall behind with your mortgage
payments. If you are having problems paying your mortgage it is important that you
get advice as soon as possible. Even if your lender has already taken court action,
it may be possible to stop or delay repossession.
You can get free help and practical advice from:
Citizens Advice Bureau
30-32 Batchen Street
Elgin
IV30 1BS
Phone: 01343 550088
E-mail: bureau@moraycab.casonline.org.uk
Moray Council Trading Standards
Money Advice Service
232 High Street
Elgin
IV30 1DJ
Phone: 01343 554623
E-mail: money.advice@moray.gov.uk
5.5.2 Home Owners’ Support Fund
If you own your home and are in danger of having it repossessed because you are
having problems keeping up with mortgage payments then there are schemes that
can help you to stay in your home.
Before applying for either of the schemes you must have:
1. Tried to reach an agreement on how to manage your arrears with the lender;
and
2. Received independent advice about your financial situation from an approved
advisor (see section 5.6.1).
An advisor will be able to tell you if you are eligible for either of these schemes and
should be able to help you get and fill in an application form.
You can get more information about either of the schemes online at
www.scotland.gov.uk/Topics/Built-
Environment/Housing/privateowners/Repossession/hosf-1 or contact:
Updated: 04 December 2012 Section 5 Page 11

Scottish Government - Home Owners' Support Fund Team
Phone: 0845 279 9999
Email: homeownersfund@scotland.gsi.gov.uk
Mortgage to Rent Scheme
If you apply successfully for the Mortgage to Rent scheme, your home will be bought
by a social landlord but you will continue to live there as a tenant. Your new
landlord will get funding from the Scottish Government to carry out any necessary
repairs so they can charge you a reasonable rent.
Due to changes introduced under the Housing (Scotland) Act 2010, if you are
accepted for the Mortgage to Rent scheme then you will not have the Right to Buy
your home from the social landlord.
Mortgage to Shared Equity Scheme
The Mortgage to Shared Equity (MSE) scheme allows home owners who can no
longer afford their mortgages and who have at least 25 per cent equity in their
property to reduce their level of secured debt while keeping a stake in the home.
Those that bought their home under the Scottish Government’s funded shared
ownership or shared equity schemes will not be considered under the Mortgage to
Shared Equity scheme.
5.5.3 Help to pay mortgage interest
Support for Mortgage Interest (SMI) payments can help homeowners with mortgage
interest payments and interest on loans for repairs and improvements. SMI is
usually paid directly to the lender and will only help pay the interest, not the amount
you borrowed.
More information can be found at your local Jobcentre Plus or online at
www.gov.uk/support-for-mortgage-interest/overview.
If you were getting Support for Mortgage Interest (SMI) but your situation changes
(for example because you are returning to work, working more hours or earning
more) then you may be entitled to Mortgage Interest Run On (MIRO). You will need
to tell your local Jobcentre Plus about the change to your circumstances, but you
should get these payments automatically.
Updated: 04 December 2012 Section 5 Page 12