What is the Open Market Shared Equity scheme?
The Open Market Shared Equity Scheme allows people on low to moderate incomes to buy homes that are for sale on the open market where it is affordable for them to do so. The scheme is currently open to help all first time buyers. Priority access will be provided to priority group applicants which include social renters (in other words, people who rent a property from either a local authority or a housing association), disabled people, members of the armed forces, veterans who have left the armed forces within the past two years, and widows, widowers and other partners of service personnel for up to two years after their partner has been killed while serving in the armed forces.
How the scheme operates
The minimum equity stake that buyers must take in a property is 60 per cent and the maximum equity stake is 90 per cent. Lenders normally require buyers to provide a modest deposit.
Applications to the scheme are assessed by registered social landlords who administer the scheme on behalf of the Scottish Government. Registered social landlords will undertake a detailed financial assessment of individual household circumstances using certain criteria, such as looking at the disposable income the household has. This information will be obtained from the standard application form which applicants to the scheme must complete.
There are limits set on the price of homes that can be bought under the open market scheme to ensure that only 'starter' properties are available through the scheme - these are known as threshold prices. These limits vary according to house prices in different parts of Scotland and are often referred to as local maximum price ceilings.
Find the maximum threshold price for your area.
Information for applicants
An information leaflet is available for applicants.
Information for registered social landlords and property professionals
With reference to Guidance Notes HSGN 2014/06 and HSGN 2014/08, new 2014 detailed administrative procedures (updated in October 2014) for the Open Market Shared Equity scheme have been produced for registered social landlords and the Scottish Government. Those are viewable in the contents section of the publications page. To view the October 2014 errata list, select ‘view as html’.
An advice note for property professionals provides an update on the scheme and clarification on who is eligible.