Young teachers trying to get a foot on the property ladder are struggling to join key worker home-buying schemes because in many parts of the country the money has dried up. Others say the schemes have become a financial trap as a result of the credit crunch.

Ministers have changed the rules so that almost anyone with a household income below Pounds 60,000 can receive help buying their first home - not just teachers, nurses, police and other key public sector workers. Caroline Flint, the housing minister, said last month the changes were required to help those struggling to find homes now, and to meet the country’s long- term housing needs.

Changes to the shared ownership scheme allow low-income families to take out an initial loan of up to 50 per cent of the value of the house they are buying, and pay only a low 1.75 per cent interest rate. The balance of the house’s cost must be borrowed from a bank or other commercial lender at market rates. Previously, teachers could borrow no more than 17.5 per cent of the property’s value from the government, so the changes should help lessen the pain of the rising interest rates on a main mortgage.

But many housing associations running the scheme have been deluged by young private-sector workers. They have run out of money and are having to turn away new customers. Richard Stone, director of affordable housing broker SPF Sherwins, said the definition of key worker had been “pushed aside”.

One housing association, Moat, said it had stopped offering key workers funding to buy flats on the open market until further notice, although plenty of specially designated properties were available in areas such as Essex, Kent and Sussex. Other teachers, who managed to join shared equity schemes before the rush, now find themselves struggling to maintain their payments and unable to sell out of the scheme or sub-let.

Hannah Essex, spokeswoman for the Teacher Support Network, said more teachers than normal were seeking advice or hardship grants this year.

“The key worker schemes are certainly well-intentioned,” she said. “However, we have heard that some teachers have difficulties finding any local authority and housing association properties available for key workers in areas around their schools. Some frequently pay mortgages or rent in two locations when they move schools because selling is so hard.”

Sarah Connaughton, 37, was caught in that trap and only recently managed to sell her south London apartment. The humanities teacher took out a mortgage to buy a Pounds 63,000 share of the Pounds 300,000 flat, and the housing association took ownership of the balance. But when she needed to move home to Manchester last year, she discovered that the apartment was an enormous liability. She could neither sell nor sub-let it and was left paying Pounds 800 a month on the empty property.

A spokesman for the Department of Communities and Local Government said it was investing Pounds 8 billion over three years to increase the number of affordable homes being built to 70,000 a year. He declined to discuss the impact the changes to the scheme will have on teachers.