The Scottish Government is reopening the First Home Fund. With a target of supporting 2,000 households in the first 100 days and 50,000 over the course of the parliament, the Fund sits within a record £4.9 billion affordable housing investment over four years.
If you’re buying your first home in Scotland, here’s what’s confirmed, what’s still to come, and what you can do now to be ready.
Table of Contents
- The background to the First Home Fund
- What we don't know yet
- How shared equity works
- Who qualifies
- How to apply and the role of your solicitor
- How it compares to other schemes
- Pros and cons
- LBTT first-time buyer relief
What is the First Home Fund?
For too many people across Scotland, home ownership has felt increasingly out of reach. People saving hard for years still find the deposit too great a barrier, particularly younger people trying to buy their first home in communities where property values have risen faster than incomes.
The First Home Fund is the Scottish Government’s direct response to that problem, designed to provide first-time buyers with a meaningful contribution toward the cost of getting onto the housing ladder.
On 28 May 2026, Cabinet Secretary Shirley-Anne Somerville confirmed to the Scottish Parliament that the First Home Fund will reopen for applications by the end of June 2026. The announcement came after sustained feedback from housing organisations and buyers unable to afford a home outright or save a full deposit without help.
Here’s what’s confirmed:
- Up to £10,000 towards your deposit from the Scottish Government
- Open to first-time buyers purchasing with a mortgage, anywhere in Scotland
- Both new-build and resale properties qualify
- Property cap of £300,000
- No interest and no monthly payments on the Scottish Government’s share
- You own 100% of your own home and hold full title
- The Government’s equity share is repaid when you sell
The scheme is a redesigned successor to the original 2019 to 2022 Fund, which offered up to £25,000. This version is simpler, broader, and not means-tested.
What We Don’t Know Yet
As of 24th June 2026, full application details have not been published. Still to be confirmed:
- The minimum deposit required from your own funds (the original scheme required around 5%)
- Joint-application rules (the original scheme allowed joint applications where only one applicant needed to be a first-time buyer)
- Whether an administering agent will be appointed and whether an application fee will apply. Under the original scheme, Link Housing administered the process, and a £550 refundable fee was charged before settlement.
- Exact timelines for concluding missives and completing settlement.
How Shared Equity Works
Shared equity is not the same as shared ownership, and the difference matters.
Under this scheme, you own 100% of your own home from day one. The Government holds a secured equity share, proportionate to its contribution toward the home’s cost. Take a straightforward example: if the Scottish Government contributes £10,000 on a £200,000 purchase price, it holds a 5% stake. When you sell, you repay 5% of the sale price, not a fixed £10,000. If your home rises in value, you repay more in cash. If it falls, you repay less.
To illustrate the repayment mechanic further: if the Government holds a 20% stake and you sell for £140,000, you repay £28,000. The stake is always a percentage of whatever the property sells for, not the original contribution figure.
The remaining share of the property, 95% in that example, is entirely yours. You are the homeowner from the moment you complete.
Under shared ownership, by contrast, you part-buy and part-rent. The First Home Fund is a shared-equity scheme. You pay no rent on the Scottish Government’s share.
Who Qualifies?
- First-time buyer. You must never have previously owned property in Scotland or anywhere in the UK, solely or jointly.
- Buying with a mortgage. Cash buyers are excluded. Normal lender affordability checks apply. The scheme does not relax lending criteria. You still need to pass your lender’s standard affordability and credit assessment.
- No buy-to-let.
- Property valued up to £300,000.
The £300,000 cap matters most in Edinburgh, where average selling prices sit just below the limit. The Edinburgh average is currently around £295,589, leaving very little headroom, and in East Lothian the average has already passed the cap at approximately £304,523, putting many properties in that area outside the scheme entirely.
In Glasgow, the average first-time buyer purchase price is around £166,000, leaving comfortable headroom. Across much of the rest of the nation, the cap is unlikely to be a subject of concern for most buyers.
The scheme is specifically aimed at making home ownership more affordable for individuals and families who are currently unable to buy. Particularly younger people, those who have been planning to buy for years but found the deposit barrier too great, are the intended beneficiaries.
How to Apply and the Role of Your Solicitor
Full 2026 guidance is still to be published. Based on the original scheme, the process runs as follows: get a mortgage Decision in Principle, find a property, apply via the administering agent, and receive an Award Letter if approved.
Taking fast action when the scheme opens is essential, as previous rounds closed within days.
You must appoint a property solicitor. A shared-equity purchase involves more legal documentation than a standard conveyancing transaction, including:
- The missives, Scotland’s binding purchase contract
- A Shared Equity Agreement and a second-ranking standard security in favour of Scottish Ministers
- An LBTT return to Revenue Scotland, including first-time buyer relief where applicable. The 30-day deadline from settlement is strict.
Your solicitor also advises you on the long-term obligations attached to the scheme, including restrictions on remortgaging and letting, and how the repayment works when you sell. Official guidance directs buyers to discuss all of this with their solicitor before committing.
How It Compares to Other Schemes
LIFT Open Market Shared Equity (OMSE)
Government contribution of 10 to 40% on open-market homes. Means and needs-tested, unlike the First Home Fund. Closed as of 2026, with reopening expected in 2026/27.
LIFT New Supply Shared Equity (NSSE)
Same model, for new-build homes from councils and housing associations.
Help to Buy (Scotland)
New-build only, up to 15% Government stake, £200,000 property cap. Closed February 2021. Not a current option.
England’s First Homes scheme
A completely different scheme offering a discount on market value. Not available in Scotland. Scottish buyers should also note that the terminology differs: in Scotland you pay LBTT rather than Stamp Duty, contracts are concluded through missives rather than exchange of contracts, and security over the property is a standard security rather than a mortgage deed.
The First Home Fund is simpler than LIFT, not means-tested, and covers both new-build and resale properties. For many first-time buyers across Scottish communities, it will be the most accessible and straightforward route into home ownership available.
first home fund scotland pros and cons
In your favour
- £10,000 toward the cost of your home, with no interest and no monthly payments
- You own your own home outright, 100% from day one
- Covers new-build and resale properties, Scotland-wide
- Stacks with LBTT first-time buyer relief, where the nil-rate threshold rises to £175,000, saving you up to £600, and with ISA savings
- The average first-time buyer deposit in Scotland is around £43,537. A £10,000 contribution from the Scottish Government narrows that gap meaningfully, particularly in lower-priced markets like Glasgow where purchase prices leave more room to manoeuvre.
Worth weighing up
- You repay a percentage of the sale price, not a fixed sum. Rising values mean a higher repayment in cash terms.
- At £10,000, the contribution is smaller than the original scheme while deposits have risen. The ESPC noted the help is materially less valuable in real terms than five years ago.
- The scheme is expected to be heavily oversubscribed and close fast.
- Remortgaging and letting typically require consent under the Shared Equity Agreement.
- If your home falls in value, you repay less, but negative equity risk remains the same as for any mortgaged buyer.
- If you offer over the Home Report valuation, you fund the excess yourself. The Government’s contribution is calculated against the lower of purchase price or valuation.
- The scheme does not change what your lender will offer. Affordability is assessed on your income and outgoings in the normal way.
LBTT First-Time Buyer Relief
The Land and Buildings Transaction Tax (LBTT) first-time buyer relief is a separate benefit that stacks with the First Home Fund and is worth understanding in its own right.
For first-time buyers in Scotland, the nil-rate LBTT threshold rises from £145,000 to £175,000. The maximum saving is £600. Unlike the equivalent relief in England, there is no upper property price ceiling, so the relief applies regardless of how much the property costs above that threshold.
The relief was confirmed unchanged for 2026/27 in the Scottish Budget. It applies automatically. Your solicitor claims it as part of the LBTT return filed with Revenue Scotland within 30 days of settlement.
One point to note: the Additional Dwelling Supplement (ADS) is a surcharge that applies when buying an additional property. For a genuine first-time buyer purchasing their main residence, ADS should not arise. Your solicitor will confirm your position before you complete.
Speak to Our Conveyancing Team
A shared-equity purchase is more legally involved than a standard transaction. Our conveyancing team handles everything, from missives and title examination through to your LBTT return and Shared Equity Agreement. We will make sure you understand your obligations before you commit, and keep you informed at every stage.
Call us on 0141 674 6144 or visit joneswhyte.co.uk to book a free, no-obligation discovery call.
Please note: This article is for general information purposes only and does not constitute legal advice. It should not be relied upon as a substitute for professional legal advice tailored to your specific circumstances. If you need advice on a legal matter, get in touch with our team.
