The Scottish Government has reopened the First Homes Fund, providing first-time buyers with a £10,000 contribution towards their first property purchase. Applications opened on Wednesday, June 24, and ministers anticipate that up to 2,000 households will benefit within the first 100 days of the new government.
How the Scheme Works
The fund is a shared-equity scheme designed to assist those struggling to save for a deposit. It 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 initiative.
Under the First Homes Fund, the Scottish Government provides up to £10,000 in return for an equity stake in the property. The buyer owns the home and holds full title, while the government's share is normally repaid when the property is sold or another repayment event occurs. There are no monthly repayments or interest charged on the government's contribution.
Eligibility Criteria
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. Key requirements include:
- You must be a first-time buyer.
- You must not currently own a property.
- You must never have owned a property anywhere in the world.
- The property must be worth £300,000 or less.
- Buyers must use a lender participating in the scheme.
Government and Industry Support
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. 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."
The reopening has been welcomed by the housebuilding sector. 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. 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
The Scottish Government confirmed that several lenders have already signed up to support the scheme, including Leeds Building Society, Scottish Building Society, Glasgow Credit Union, NatWest, and Lloyds Banking Group. More lenders are expected to join in the coming months.
