Finance News

Scottish First Home Fund closes to applications after five days

Rozi Jones
|
9th April 2021
Scotland Edinburgh Scottish houses
"The Scottish Government allocated just 30% of the levels spent in 2020, citing budget cuts from Westminster for the reduction."

The Scottish Government’s £60m First Home Fund has closed to applications after being exhausted only five working days since its reopening.

The First Home Fund opened on 1st April this year with a budget of £60 million, down from £200m last year.

The scheme was introduced in December 2019 to help buyers purchase their first home from either the new or secondhand market, providing up to £25,000 as an equity loan. Buyers must contribute a minimum deposit of 5% of the purchase price and take out a minimum 25% mortgage on the purchase price.

Since opening at the start of this month, the fund has been allocated and applications have now closed.

A messge on the Scottish Government's website says: “The First Home Fund is fully committed for 2021-22 and applications are now closed. Any applications in progress but not yet submitted at point of closure are unable to be processed.”

Nicola Barclay, chief executive of industry body Homes for Scotland, commented: “This will clearly be very disappointing news to all those people who had been hoping that the First Home Fund would enable them to get onto the property ladder.

"We anticipated that there would be huge demand given the success of the pilot scheme run last year. Despite this, the Scottish Government allocated just 30% of the levels spent in 2020, citing budget cuts from Westminster for the reduction. This also comes on top of the closure of the hugely successful Help to Buy scheme and will be a huge blow to all those who aspire to own their own home.

"The lack of availability of 95% LTV mortgages has made it incredibly difficult for first-time buyers to access mortgage finance, despite strong evidence that shows that owning a home is often cheaper than renting. I urgently call on Kate Forbes to act now to support all those who will be devastated by today’s announcement. No one can be in any doubt about the need to support those unable to save for large deposits, and we will be watching closely at pledges made by all political parties as the election campaign continues.”

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