Open Market Shared Equity scheme
The Open Market Shared Equity scheme currently runs across the whole of Scotland. The scheme allows people on low incomes to buy a home on the open market with assistance from the Scottish government.
How does the Open Market Shared Equity scheme work?
The scheme works in a similar way to the New Supply Shared Equity scheme, with similar rules. However, if your application to the scheme is approved, instead of purchasing a stake in a home provided by the housing association, you will find your own property to buy on the open market. If the property meets your requirements, then the Scottish government will help you buy it by purchasing a stake (usually 10 to 40 per cent). When you sell the property, the Scottish government will recover its share of the proceeds.
Who can apply?
The Open Market Shared Equity scheme is aimed at people on low to middle incomes. Eligibility to the scheme is based on the amount of the mortgage that you might be able to raise, compared with the value of the property that is suitable for your needs. If you can raise more than 90% of the value of the property then you will not be eligible for the scheme.
The Scottish government has set the maximum prices of the property that is available for the scheme and these prices vary across Scotland, you can find more information on these prices here.
You may also be given priority access to the scheme if you meet the eligibility criteria and you are serving in the armed forces, or have left the armed forces in the previous twelve months.
How do I apply?
If you think you may be eligible, you will have to contact the registered social landlord operating the scheme in the area that you are interested in moving. Who will then help you through the application process.
If your application is approved, you will be sent a 'passport letter' explaining the next steps in the process, it will also outline the size of property and the maximum price that you can pay for a home. You can then start looking for a suitable home on the open market.
You can find out more about finding a home to buy, appointing a solicitor and how the buying process works in the section on buying a home. Remember, you will have to pay all the expenses of buying a home. If you are disabled, need to move to a more suitable home and are in receipt of income support, you may be able to repay some or all of your mortgage interest through your benefits. Read the page on getting a mortgage if you're disabled to find out more.
Are there any restrictions?
There is only a limited amount of money available for purchases through the Open Market Shared Equity scheme, and applications will be approved on a first come, first served basis. Only a certain number of people will be accepted onto the scheme at the same time.
You will only have 12 weeks to find a property. After this, your application will lapse. You may wish to start looking round before your application is approved, to give you an idea of the kind of areas and properties that may be suitable.
You'll normally need to provide quotes, stating anticipated mortgage levels, from three different lenders. If this isn't possible, it may be okay to provide only one or two.
The Scottish Government has set a maximum price that can be paid for homes. These prices vary depending on the size of the property and where it's located. You can see a list of maximum prices on the Scottish Government website.
If you have savings, you can keep back £5,000 to pay for the costs of moving or any emergencies. 90 per cent of any savings above this amount will need to go towards the house purchase.
You'll need to get written permission from the housing association before you can take in a lodger or let out your home.
What if I am in a priority group?
Priority access to the scheme will be granted to the following groups of people, so long as they can prove their eligibility:
People over 60
People who rent a property from either a local authority or a housing association
Disabled people with a housing need
Members of the armed forces
Veterans who have left the armed forces within the past two years
Widows, widowers and other partners of service personnel for up to two years after their partner has been killed whilst serving in the armed forces
If you are on a waiting list and you fall into one of these categories then your application will be considered first by registered social landlords. Once all applications from priority groups have been considered, then other applications on the waiting list will be considered.
Where can I find out more?
The Scottish Government has more information on the Open Market Shared Equity scheme.
Last updated: 11 April 2018
Housing laws differ between Scotland and England.
This content applies to Scotland only.