Budget 2013: Help for Edinburgh housing market HELP for homebuyers announced as part of the Budget was today welcomed as a boost for Edinburgh's housing market. Chancellor George Osborne unveiled a new "help-to-buy" scheme for people struggling to find mortgage deposits - though only part of it will apply in Scotland, The UK Government will introduce a mortgage guarantee to encourage lenders to offer 95 per cent loans, leaving would-be buyers to find a deposit of just five per cent - around £10,500 for an average house in Scotland. The scheme applies to existing homeowners as well as first-time buyers and both existing and new-build homes are eligible. But the Government said another aspect of the scheme - offering prospective buyers a 20 per cent equity loan on new-build properties - would not be avaialble north of the Border unless the Scottish Government decides to implement it. Edinburgh Solicitors Property Centre praised the Chancellor's initiative. Chief executive Malcolm Cannon said: "High deposit requirements continue to hinder the property market in Scotland and an additional incentive to kick-start prudent lending is very welcome. This will impact positively on the housing market and the wider economy both locally and nationally. Andrew Smith, partner in estate agency Strutt & Parker's Edinburgh office, said the measures to help the property market would provide a welcome boost for house sales. He said: "The new mortgage guarantee is very good news. This will help those who do not have a substantial deposit but can afford the monthly mortgage payments. Anything which frees up the availability of mortgages and gives mortgage lenders the security and confidence to know they will be repaid is undoubtedly positive as one of the factors influencing buyers" decisions is the lack of mortgage finance. This initiative will help buyers move up the housing ladder and inject some momentum into the whole housing industry. But there were calls today for the Scottish Government to make the full scheme, including the 20 per cent loans, available in Scotland. Lothians Conservative MSP Gavin Brown said it was an excellent package. He said: "I think the Scottish Government should look very seriously at the equity loan scheme to ensure aspiring homeowners in Scotland are not put at a disadvantage." The help for homebuyers was one of a series of eye-catching initiatives announced by the Chancellor, who also froze fuel duty, took 1p off a pint of beer, lowered the tax threshhold to £10,000 and cut corporation tax to 20 per cent. But not everyone was impressed with the home-buying measures, Scottish Green leader Patrick Harvie said: "George Osborne barely mentioned the impact of slashing welfare on households, but instead threw millions at an outdated notion that everyone must aspire to be a home-owner, regardless of the reality of the housing crisis across the UK. SNP ministers should be prepared to set a different course by protecting public sector pay and dropping their obsession with slashing corporation tax ever deeper. The Chancellor gave a helping hand to the financial services sector by announcing the abolition of a stamp-duty tax paid by UK-based asset management companies, which he said was hindering firms in Edinburgh and London from competing with rivals overseas. The Government said the move would help generate "substantial numbers of jobs in middle and back office functions." Welcoming the move, Edinburgh West Liberal Democrat MP Mike Crockart said: "This will cut costs for UK-based asset managers, making them more competitive and making it easier for them to launch new funds. Hopefully it will mean a growth in funds under management in Edinburgh and a growth in employment in these areas. The aerospace sector in and around the Capital will benefit from a new £2.1 billion Aerospace Technology Institute supporting research in the sector. But there was disappointment that Mr Osborne failed to halt the planned increase in air passenger duty. The Board of Airline Representatives in the UK (BAR UK) said it was "a slap in the face from the Treasury" and accused the Chancellor putting "beer before aviation." VisitScotland chairman Mike Cantlay warned the decision could damage the tourism economy. He said: "We are particularly reliant on air service access and UK air passenger duty is the highest of any major European country. People envy Scotland's position in the world tourism market, but our research shows that value for money is becoming a much stronger influence when deciding where to go on holiday. The Scottish Chamber of Comnerce also criticised the decision. Chief executive Liz Cameron said: "This tax is depriving Scotland of up to 2.1 million air passengers and £210 million of visitor spend each year. It defies logic that the Chancellor is persevering with this damaging tax. Citizens Advice Scotland said the budget offered little relief for vulnerable families hit by the Government's welfare reforms. Chief executive Margaret Lynch said: "The Chancellor talked a lot about the importance of aspiration. The trouble is that for increasing numbers of people in Scotland today, their biggest aspiration is to put food on the table to feed themselves and their children, or to pay this month's rent or heating bill without going further into a spiral of debt. The small business SELF-EMPLOYED stationer Kirstie Clifford, 41, works long hours for her income, which varies wildly from week to week. Owner of White Blossom Paper Boutique, on Bruntsfield Place, she believes her biggest coup from the Budget could be the raising of the personal allowance threshold to £10,000. And she said the New Employment Allowance, which will knock the first £2000 off the National Insurance bill for every business, could pave the way for her to recruit her first employee. Chancellor George Osborne said it would mean that 450,000 small businesses will in fact pay no NI at all. But she claimed not enough was done to help struggling small businesses. "I was hoping he might reduce VAT a little," she said. Small businesses are really struggling and I don't think there been enough done in this Budget. If they cut VAT or raise the VAT threshold for businesses that would be huge. When you reach a turnover of £72,000 you have to pay 20 per cent of everything you make to the VAT man. If the level was higher businesses might be able to take on more staff as well. However, Ms Clifford said the cancellation to a a 3p fuel duty rise would benefit retailers and consumers. "Even though I don't run a car the price of fuel affects everything we buy," she said. And she added: "I think there's some good things in the Budget with the £10,000 tax threshold and national insurance cut that will help some small companies but overall it's very poor and he needed to do something radical." Publican Ben Prowse, 35, co-owns the Polwarth Tavern on Yeaman Place which he has run for the last six years. While he was pleased that the Chancellor cut a penny on a pint, he said it wouldn't make much difference to the struggling pub industry. He said: "Of course, it's better than duty going up. I charge £3 for a pint of Tennents but I'm not going to charge £2.99 to customers now because of brewery increases. It's not going to affect anything for is. I think as a small business he could have looked at VAT or rates. The First-Time Buyer FOR first-time buyer James Reekie, 26, news from the Budget has revived an ambition to get on the property ladder. The electrical technician, who lives in the city centre, has been flirting with home-ownership for several years but was turned off by stagnation in the lending market. Now, he believes the Chancellor may have created a funding platform to help him buy his first house. "Putting together a sizeable deposit to put towards a mortgage is what's really got in my way," said James, who lives in Frederick Street. One of the pillars of this year's budget was the "Help to Buy" scheme which offered help to homeowners and those seeking to get on the property ladder. Scots will qualify for a mortgage guarantee for new and existing properties that will require buyers to stump up a five per cent deposit on the value of the home - rather than ten per cent which is often required. The Government guarantee is designed to encourage lenders to offer better access to low-deposit properties. A Government plan to offer an equity loan up to 20 per cent of the value of the property - to be repaid on the sale of the house - is understood not to be available in Scotland. James Reekie said his credit rating and job security were sound but he would struggle to put together the "£20,000 or so" to buy a "decent first home." Getting the money together as a deposit would be a problem so having a reduction on that would help. It's a fair chunk to try to get together and I guess it depends on the sort of property you want. I'm sure you can get a small one-bedroom place on the outskirts of Edinburgh for £100,000 but I would like something half-decent. It's been bugging me the last six months to a year: I'm getting older and want to try to get on the property ladder. I was listening to the Budget today and the thing that stood out was that this and would definitely encourage me to try. The family PROMOTIONS manager Dave McGuire and wife Jane will pay less on their weekly pints and save hundreds of pounds per year on fuel - but believe the family finances will remain unchanged by the Chancellor's budget. The McGuires have a combined annual income of more than £60,000 and no longer pay nursery fees for six-year-old daughter Alice, who is now at primary school. Dave, 39, welcomed the Chancellor's decision to raise the personal allowance threshold to £10,000 come April 2014 but said any extra cash derived from this could be negated by changes to the tax band threshold. Jane, who works in market research, is the family's chief breadwinner and her take- home pay may be reduced by the narrowing of income bands to £41,865 for the higher rate of tax. The father-of-one said: "The two things will likely balance each other out and I expect it will be a status quo for our family. If anything her big bugbear is when tax goes up she gets stung almost as much as someone earning infinitely more than she is. Living in Leith Links, the McGuires rarely use their car save for family visits and both commute to work. But even with moderate use, they believe the cancellation of the 3p per litre planned increase on fuel duty - set to be introduced for the autumn 2013 - could give them more money in their pockets. Chancellor George Osborne said petrol and diesel would noW be 13 pence cheaper than it would have been had the duty not been frozen for the last two years. "For a Vauxhall Astra or a Ford Focus, that's £7 less every time you fill up," he said. And Dave said freezing fuel duty and scrapping the looming 3p rise would help his family and consumers generally by lowering the cost of distribution and delivery of goods. On the decision to replace a planned 3p rise in beer duty with a 1p cut in the price of a pint, Dave said: "I'm a beer drinker but it has become extortionate in price. A 1p cut is not going to make much of a difference - a penny off far too much means it is still far too much. The expert Aspiration was the word from the Chancellor yesterday. He presented a "budget for people who aspire to work hard and get on" and told the Commons he was "firing up the aspirations of our people." I hope he's right and Edinburgh's small businesses can begin to look with confidence at opportunities they might have otherwise passed up. Small businesses and their potential to drive recovery were central to this budget, something which the Federation of Small Businesses (FSB) unsurprisingly welcomes. "What will get your members creating new jobs and recruiting?" is a question I have been asked a lot, especially in relation to the Edinburgh Guarantee youth employment initiative. Our recent Micros Untapped report provided some of the answers with its call for a rethink of business support in Scotland for micro businesses, especially on employment issues. We have also lobbied the Chancellor for a National Insurance Contributions holiday for all micro businesses, where our modelling predicts 45,000 new jobs could be created with cuts for the smallest employers. Indeed, surveys of our members suggest that over half of them would be encouraged to recruit following a National Insurance holiday. We are very pleased, therefore, that the Chancellor has listened and announced a £2000 National Insurance reduction for all businesses. In addition, Edinburgh's businesses also need consumer confidence to bounce back. Thus, the Scotland Office suggestion that increasing the personal tax allowance to £10,000 will take 224,000 people in Scotland out of income tax altogether, coupled with yesterday's welcome news that unemployment fell in Scotland by 4000, should provide encouragement to consumers. n Gordon Henderson, senior development manager for the Federation of Small Businesses At a glance From 2014-15, no-one will pay tax on the first £10,000 of their salary and the lowest-paid will pay no tax at all. Someone earning £25,000 will see their bill drop by £379. The increase of around 3p per litre on petrol and diesel, due in September this year, is cancelled. The Government says it will save a typical motorist £25, a van driver £50 and a haulier £750 per year. Drinkers will get a penny off a pint from Sunday evening. Duty on other alcoholic drinks will increase by two per cent above inflation, as planned. Families where both parents are working will be able to claim tax relief of 20 per cent on childcare support, worth up to £1200 per child, from autumn 2015. The Government says 210,000 Scottish families stand to gain. A new Help to Buy scheme aimed at people who can't afford a big depost will provide an equity guarantee on 95 per cent mortgages for new-build properties. From 2015, a further one per cent cut will leave businesses paying just 20 per cent. All employers will see their National Insurance bill cut by up to £2000 per year.