The Scottish government has reintroduced the First Homes Fund to assist first-time buyers in overcoming deposit challenges when purchasing a home. This shared equity scheme, which reopened on 24 June 2026, provides eligible buyers with up to £10,000 towards the purchase price of a property, making it easier for them to enter the housing market.
What is the First Homes Fund?
The First Homes Fund is a government-backed initiative designed to support first-time buyers in Scotland. Under this scheme, eligible buyers can receive a contribution of up to £10,000 towards the purchase of a home valued at up to £300,000. To qualify, buyers must provide a minimum personal deposit of 5% of the property’s purchase price, ensuring they have a stake in their investment.
Who is affected by this scheme?
This initiative primarily benefits first-time buyers who struggle with high deposit requirements. By lowering the financial barrier to entry, the First Homes Fund encourages homeownership among younger buyers and those with limited savings. While the scheme does not directly target landlords or buy-to-let investors, its impact on the housing market could indirectly affect rental demand and property values.
What this means for buy-to-let mortgage investors
For buy-to-let mortgage investors, the relaunch of the First Homes Fund could lead to increased competition in the housing market as more first-time buyers enter. This influx may drive up property prices, affecting rental yields and overall investment strategies. Investors should monitor the evolving market dynamics closely, as changes in homeownership rates could influence demand for rental properties.
Frequently asked questions
How does the First Homes Fund work?
The First Homes Fund provides eligible first-time buyers with a government contribution of up to £10,000 towards the purchase price of a home, requiring a minimum personal deposit of 5%.
Will the First Homes Fund affect rental property demand?
Yes, as more first-time buyers enter the market, there may be increased competition for properties, potentially impacting rental demand and property values.