New fund to lend up to £25,000 deposit to first-time buyers

First Minister Nicola Sturgeon has announced a new fund to help first-time buyers get on the property ladder by lending them a chunk of their deposit.

Starting later this year, the Scottish Government will create a £150million national pilot scheme to provide support for first-time buyers with the deposit they need when they want to buy a home.

Buyers will be required to fund a minimum of 5% of the value of their new house from their own funds and loans can be up to £25,000.

This loan will be secured on the equity of the home; is repayable in full at any time; and must be repaid if the home is sold. No monthly payments will therefore apply.

In a further part of the package, oversupply of short-term lets - made popular by websites like airbnb - will be tackled in order to protect the interests of local communities and ensure a safe, quality experience for visitors, with new proposals published for consultation.

A place to call home

First Minister Nicola Sturgeon said: “Some first time buyers trying to get onto the property ladder can call on the financial help of relatives or friends – the famous bank of mum and dad. But for too many, the simple truth is that, even on decent incomes, saving for a deposit takes so long it has become a distant dream.

“Many are even paying more in rent than they would pay for a mortgage and the simple fact is they don’t have the money left at the end of the month to save for a deposit.

“In a fair and equitable country that cannot stand. And so we will act. We will help young people with the deposits they need.

“If buyers can find just 5% of the value of their new house from their own funds, we will do the rest. Starting later this year we will pilot a scheme to offer first-time buyers loans of up to £25,000 to fund or top up their deposit."

Short-term lets

Revealing the new proposals on short-term lets, Ms Sturgeon: “For many people, short-term lets have enabled cheaper, more flexible travel. It’s one of the reasons Scotland’s tourism industry is booming. But for others – particularly in tourist hot spots – it is making it harder to find homes to live in.

“We are asking for views on a new system of regulation to make short term lets subject to the same controls as other accommodation. And give councils the power to control the number of lets and ensure they make a contribution to the services they use."

The consultation will seek views on the appropriate use of planning, health and safety, regulation and taxation powers in order to ensure local authorities can secure an appropriate balance between the needs of communities and the role of short-term lets as part of our tourism industry.

Thinking of buying?

Buying a home is often the single most important financial transaction a person will make in their lifetime, so it’s important to make the correct decisions.

As an estate agent, law firm and independent mortgage adviser, Aberdein Considine offer everything you need to buy your first home - all 'under one roof'.

Click here if you would like to make an appointment at your local branch.