The Scottish Government has reopened the First Homes Fund, giving first-time buyers the chance to receive a £10,000 contribution towards the cost of buying their first property.
Applications for the shared-equity scheme opened last month and the Scottish Government expects it to help up to 2,000 prospective buyers take their first step on to the property ladder during the first 100 days of the new government.
The fund is designed to help people struggling to save for a deposit and can be used to buy any home valued at up to £300,000. Over the course of this Parliament, around 50,000 households are expected to benefit from the £500 million scheme.
How the First Homes Fund works
Under the First Homes Fund, the Scottish Government provides a contribution of up to £10,000 in return for an equity stake in the property. The buyer owns the home and holds full title to it, while the Government's share is normally repaid when the property is sold or another repayment event is triggered under the terms of the agreement.
There are no monthly repayments to make towards the Scottish Government's contribution and no interest is charged.
A first-time buyer is defined as someone who does not currently own, and has never previously owned, a property in Scotland or anywhere else in the world.
Government and industry reaction
Cabinet Secretary for Social Justice and Housing Shirley-Anne Somerville said: "We know how hard it is to get that first foot on the property ladder and the opening of this fund is a direct response to stories I have heard from so many people who are keen to buy their first home."
Somerville added: "The First Homes Fund is part of a broader programme of action, supported by a record £4.9 billion investment in affordable housing over the next four years. We promised to act to make life easier for many and fairer for all and, through the First Homes Fund, we are delivering on that promise."
Jane Wood, chief executive of Homes for Scotland, said: "Reintroducing the First Home Fund was a key Homes for Scotland ask ahead of the election, so we welcome this important step from the Scottish Government."
Wood added: "Supporting first-time buyers is essential, not only in helping to address Scotland's existing housing need, but also in stimulating wider socio-economic growth across the country."
Participating lenders
Several lenders have already signed up to support the scheme, including: Bank of Scotland, Glasgow Credit Union, Halifax, Leeds Building Society, Lloyds Bank, NatWest, Scottish Building Society, and Skipton Building Society. More lenders are expected to join in the coming months.
Eligibility criteria
To apply for the First Homes Fund, you must be a first-time buyer, not currently own a property, and never have owned a property anywhere in the world. The property must be worth £300,000 or less, and buyers must use a lender participating in the scheme. Full details about the fund can be found on MYGOV.SCOT.
