The Scottish Government have addressed the need for a Scottish version of the Help to Buy scheme which has been successful in getting the property market moving in England with 10,000 reservations since April.
Details of the new shared equity scheme were unveiled today by the Deputy First Minster, Nicola Sturgeon. £220 million will be allocated for the scheme over the next 3 years. The Help to Buy (Scotland) scheme opens on Monday 30th September 2013.
The scheme will be open to all eligible first time buyers and home movers, giving them the opportunity to purchase a new build home from a participating Help to Buy development with just a 5% deposit!
With the 5% deposit, the home buyer will then get a 20% equity loan from the Scottish Government, therefore only a 75% mortgage will be required to buy a home up to a maximum of £400,000. The scheme puts home ownership back in reach of those who previously were restricted by high deposits and expensive mortgages. The 20% equity loan from the government will remain interest free, a significant difference from England’s scheme where interest is charged after an initial 5 year period.