Shared Equity
SHARED EQUITY SCHEMES
There are two schemes in particular promoted by the Scottish Government to assist people into home ownership. These are:
- New Supply Shared Equity
- Shared Ownership
What is New Supply Shared Equity?
New Supply Shared Equity is a Low-cost Initiative for First-Time Buyers (LIFT), the new, government funded, affordable homes for sale scheme. You get the opportunity to buy a 60% to 80% share of the property from the Association. The Scottish Government will hold the remaining share, under a shared equity agreement. There is no additional rent charge.
You will own the property but the Government’s interest will be secured against the property.
If for example you own a 75% share of the property you would get 75% of any receipt from the sale of the property.
The scheme is aimed at first time buyers such as tenants, people living with relatives, people from the Armed Forces. But it can help others such as disabled people who are currently in housing not suitable for their needs.
Applicants will be assessed for LIFT based on the household income and savings. Once your eligibility has been assessed, you will be advised how much of the property you can purchase. You must be able to afford to purchase a minimum of 60% of the property, but no more than 80%.
For further information on the scheme and for the list of associations with properties for sale, go to the Communities Scotland website http://www.communitiesscotland.gov.uk/ and select LIFT.
What is Shared Ownership
This shared equity scheme has been running for a number of years. Under the scheme you part buy and part rent your home.
The property can be bought in 25% chunks with a maximum of 75% being allowed in the first purchase. You can buy more each year or stay on the portion that you first purchased. You can eventually buy the house outright.
You are responsible for maintaining the property and the low rent charged to you by the Association reflects this fact. When selling your property you will receive any profit from the sale of your share.