Hit by the global downturn, the credit crunch and restricted mortgage lending, Scotland’s homebuilding industry is facing some challenges. Peter Brogan, managing director of Strathclyde Homes, the housebuilder, says: “These are the worst conditions the homebuilding industry has ever experienced. We’ve seen thousands of redundancies. This year, any builder who covers their costs will have done well. Still having to fund fixed costs, builders are finding it impossible to keep cash flowing into their business,” he says.

Bad news for builders, however, can be great news for buyers. Builders are doing all they can to win your business, with some said to be cutting profit margins to £1,000 per home.

Whether you are making a first-time purchase or trading up, new-build properties can be more affordable and more easily obtained than second-hand options.

John Slater, managing director of Stewart Milne Homes, says: “We are offering practical options to help buyers: affordable mortgages, contributing to first-time buyers’ fees and deposits, and helping homeowners to sell their property.”

The deals include everything from waived fees to partial ownership. Stewart Milne also offers a preferential 4.99% fixed-rate mortgage deal.

The company protects the value of new homes when they are sold. If properties sell below the pre-agreed minimum market value, they will refund the difference.

Cala Homes offers similar incentives, including cashback and discounts. Stamp duty and part-exchange are also offered on selected plots across nine developments from Newton Mearns to Larbert.

With Miller Homes’s MiWay scheme, buyers can pay 75% now and 25% later yet still own 100% of their property from the beginning. With this deal, Miller Homes provides a 0% APR loan to make up the residual 25%. Buyers pay no interest on this amount for up to 10 years or when they sell. The buyer pays back the 25% of their property’s market value at that time.

Tim Hough, chief executive of Miller Homes, says: “With this scheme, we are helping homebuyers get the best mortgage deals on offer.”

While builders are helping buyers, however, nervous lenders still fear they may pay later. Before agreeing a loan, they insist lawyers fill in a form for newbuild purchases with a breakdown of cashbacks, offers, incentives and depreciating assets.

Craig Scott, of Regents Estates, who is also a lecturer with the Financial Services Authority, says: “In these risk-averse times, lenders are looking at re-sell value. These deals obscure the fact that new homes are simply harder to sell for the second time when compared with similar, but new, properties.”

As a financial adviser, Scott has seen everything from shared ownership schemes to including a Range Rover in a deal to gain contracts, but he says cash reduction is the preferred option.

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