Shared equity and shared ownership schemes in Scotland

Scotland runs several shared equity schemes that help people on low to moderate incomes buy a home they could not otherwise afford. The main ones are Open Market Shared Equity (OMSE), which helps you buy an existing home on the open market, and New Supply Shared Equity (NSSE), which helps you buy a new-build home from a council or housing association. In each case you pay for the biggest share of the home, usually between 60% and 90% of its cost, and the Scottish Government holds the rest under a shared equity agreement¹.

The crucial point is that you own the home outright. Your name goes on the title deeds, you do not pay rent on the Government's share, and you are responsible for the mortgage, insurance, repairs, council tax and all the other costs of ownership¹. What the Government gets in return is its percentage of the money when you sell, or when you buy back some or all of its stake. If you have a 70% share and sell the home, you receive 70% of the selling price and the Scottish Government receives 30%².

How shared equity works: you own the home, the Government holds a share

Shared equity in Scotland is built on one idea: the buyer holds the title and the Scottish Government holds a financial stake. Under OMSE you own the property outright, and the Government's interests are secured by a standard security, the Scottish equivalent of a mortgage, registered against your home⁷. The same arrangement applies to NSSE: you have complete title to the home, your name is on the title deeds, and a standard security protects the Government's share³.

Because you are the owner, everything that comes with ownership falls to you. That means paying your mortgage, home contents and building insurance, repairs and maintenance, council tax, heating, lighting and water bills, and providing your own fittings and furniture¹. The Government is not a landlord and charges no rent; it is a silent stakeholder whose money is recovered when the home is sold or when you choose to buy back its share².

The Government's stake is a percentage, not a fixed debt. If you pay for 75% of the home, the Scottish Government helps with 25% of the purchase price¹. If you pay for 70%, it holds 30%³. When the home is sold, each party receives its percentage of the sale price, whatever the home is then worth². That cuts both ways: if the home rises in value the Government's share is worth more, and if it falls the Government shares the loss.

The schemes sit within the Scottish Government's Low Cost Initiative for First Time Buyers, and the Government publishes monitoring information on how they perform. An evaluation estimated the "rate of additionality", the share of buyers who would not have bought without the scheme, at 47% for OMSE and 39% for NSSE⁸. In other words, roughly half of OMSE buyers could not have bought a home any other way.

Open Market Shared Equity: buying an existing home with a 60% to 90% stake

OMSE is the route for buying an existing home that is already on the market, rather than a new build. You contribute between 60% and 90% of the purchase price, and Scottish Ministers provide the remainder⁶. In most circumstances you must take a stake of at least 60% of the price, and in all cases the maximum initial stake is 90%⁶. If you could afford more than 90% of the purchase price yourself, your application will not be eligible⁶.

The scheme is aimed at households on low to medium incomes, and the organisation that administers it assesses each application to see whether the applicant qualifies¹. You need to show that you cannot afford to buy a home that meets your needs without the scheme's help¹. A lender may still expect you to provide a modest deposit to obtain a shared equity mortgage⁷.

Your contribution is worked out as the maximum mortgage you can reasonably obtain and afford, plus any personal deposit you are able to put in⁶. If you offer more than the home's valuation, any amount over valuation must be funded in cash and must still fall within the price threshold⁶. The Government's equity share is based on the valuation figure rather than the purchase price⁹.

OMSE is available across Scotland¹⁰, and the Scottish Government describes it as a scheme designed to help eligible buyers on low-to-moderate incomes purchase a home on the open market, usually funding 60% to 90% of the price¹¹.

New Supply Shared Equity: new-build homes from councils and housing associations

NSSE helps people buy a new-build home from a housing association or local council when they cannot afford the total cost¹². As with OMSE, you pay for the biggest share, usually between 60% and 80% of the home's cost, and the Scottish Government holds the remainder under a shared equity agreement³. A standard security protects the Government's share, and you have complete title with your name on the title deeds³.

The scheme aims to help people on low to moderate incomes purchase a new-build home where doing so is sustainable for them¹³. The local council or social landlord in your area assesses your application, and you must show that you cannot buy a new-build house that suits your needs without the scheme's help³. Buyers are responsible for the usual ownership costs, including factors costs where these apply in Scotland³.

Because these are new homes, the scheme guidance covers what happens if something goes wrong: where a buyer has serious problems with a new home, for example if a defect is discovered, the guidance names the solicitor as the first point of contact³. Our page on new home warranties explains the cover that usually comes with a new build.

If you have a 70% share and decide to sell, you get 70% of the selling price and the Scottish Government gets 30%¹⁴. In some circumstances the Government keeps a share of 20% of your home, a point covered below under the golden share¹⁴.

Help to Buy (Scotland) Affordable New Build: up to 15% of the price

Help to Buy (Scotland) was the third shared equity scheme, providing help of up to 15% of the purchase price of an affordable new build home, with a maximum threshold price of £200,000¹⁵. The scheme is no longer open to new applications, but many homeowners still hold Help to Buy (Scotland) equity stakes, so its rules still matter.

Under those rules you owned at least 85% of the home's equity when you first bought it, and you could increase your share in steps of at least 5% of the home's prevailing market value in any one year, all the way up to 100%¹⁶. The Government was paid its percentage of the sale price when the home was sold: a house bought for £150,000 with a 15% Government share, sold for £170,000, meant the Government received 15% of £170,000¹⁶. If the value dropped and the house sold for £130,000, the Government was entitled to 15% of £130,000¹⁶.

The home had to be your sole residence, and the guidance was blunt on letting: permission to let the home would not be given in any circumstances¹⁵. An evaluation estimated the rate of additionality for Help to Buy (Scotland) at 20%, below the 47% estimated for OMSE⁸. Existing homeowners can read more in our page on Help to Buy (Scotland).

Who can apply: low to medium incomes, priority groups and buyers aged 60 and over

OMSE is open to first-time buyers and to certain priority access groups¹⁰. The priority groups are social renters, meaning people who rent from a local authority or housing association, disabled people, people aged 60 and over, members of the armed forces, veterans who left the armed forces within the past two years, and widows, widowers and other partners of service personnel for up to two years after their partner was killed while serving⁹. The scheme exists for first-time buyers and priority groups who cannot afford the full price of a home¹¹.

The income test is not a fixed number. Because the scheme is aimed at households with low to medium incomes, the administering agent assesses your application to see if you qualify¹, and you must show you cannot afford a suitable home without help¹. NSSE works the same way, with the local council or social landlord carrying out the assessment³.

Buyers aged 60 and over get special treatment. Under OMSE, if you are aged 60 or over there is no requirement to take out a mortgage, but you must contribute as much as you can towards the purchase price⁶. The same applies to NSSE, where over-60s do not have to take out a mortgage while other buyers do¹². Under Help to Buy (Scotland), buyers aged 60 or over were not required to take out a mortgage, though those applying without a mortgage, or with a mortgage of less than 25% of the purchase price, had to demonstrate a housing need to move¹⁵.

Price thresholds and how much you must contribute

You cannot buy a home under OMSE for more than a certain maximum threshold price, and there are different threshold prices across Scotland¹. The thresholds are set at the middle (median) house price for each property size in each housing market area, worked out by matching Scottish Assessors data on the number of rooms with Registers of Scotland data on house prices, and all thresholds are rounded up to the nearest £5,000¹⁷. They were uprated to 2025 to 2026 based on local house price inflation, then lifted by a further 4.2% to allow for potential house price inflation in 2026 to 2027, and they are reviewed regularly¹⁷.

Property size is measured in "apartments", meaning habitable rooms. Kitchens, bathrooms, box rooms, utility rooms and hallways do not count, and glass conservatories do not qualify⁶. Before you buy a house in Scotland, the seller must give you a Home Report, which contains the valuation used in the assessment¹.

Your personal contribution is measured against your savings as well as your mortgage capacity. You may retain £5,000 of any personal contribution to help fund the costs of buying, such as legal fees. For any amount above that, 90% of your funds must be treated as a deposit contribution towards the cost of the home⁶. The buyer information leaflet gives an example: an applicant with savings above the allowance may keep £5,000 and must contribute 90% of the balance¹⁸.

Applying and buying: passport letter, valuation and solicitor

OMSE applications are handled by the scheme's administering agent, Link Homes, which assesses whether an applicant is eligible, and the scheme's information leaflet sets out the rules in full before you apply⁵. If your application is approved, you will receive a passport letter confirming you can now look for a home under the scheme, stating the maximum price you can pay and the next steps⁵. The passport letter is valid for a 12 week period⁶.

Once you have found a home you like, you will be asked to provide a copy of the valuation, which will usually be in the Home Report given by the home's seller⁵. The valuation must come from an independent professionally qualified valuer registered with the RICS; for a new-build property you would need to obtain one at your own expense⁶. You then pay for your share of the home's price in the usual way, along with the other costs of buying, such as legal costs, registration fees and any LBTT⁵. Our page on the costs of buying a house covers these in detail.

When you are ready to buy, you need a solicitor to act on your behalf, and the Scottish Government has its own solicitor who handles the work involving its equity share⁵. If you receive an offer on a shared equity home that is less than 95% of the Home Report valuation, the administrative agent must seek approval from Scottish Ministers before the sale can proceed⁴.

For NSSE, the route is different: you contact the relevant registered social landlord or local council directly, and it will tell you how to apply¹⁹. The application asks for your current income, the size of mortgage you can afford, how much of a personal contribution you can make, and information about your household and current accommodation¹⁹. The social landlord then writes to tell you whether you qualify and what to do next¹⁹.

Increasing your share, remortgaging and the golden share limit

You can increase your share at any time while you own the home, a process sometimes called staircasing. Under OMSE you must increase by at least 5% in a year, and in most cases you can go all the way up to 100%, at which point the Scottish Government no longer has a share in your home². You pay all the valuation and legal costs, as well as the administration costs of the organisation handling the request². The Government's stake when you increase is calculated as a percentage of the latest valuation⁶. Our page on increasing your share in an OMSE home goes through this in detail.

The golden share is the limit on that freedom. In certain circumstances the Scottish Government will keep a stake in the property permanently: 10% for OMSE homes and 20% for NSSE homes⁴. For OMSE this is likely in areas where there are only small amounts of affordable housing and few opportunities to build more¹⁸. If your agreement has a golden share clause and you bought an initial stake of 70%, you can only increase up to a maximum of 90%²⁰. Under NSSE, the same buyer could only increase up to 80%, because the Government keeps 20%¹⁴.

If you want to remortgage, you must contact the registered social landlord or local council that handled the sale, and you are responsible for all the costs, including the administrative costs of that organisation and the Scottish Government's solicitors². The administering agent will also contact you on or around the fifth, tenth and fifteenth anniversary of the settlement of your transaction⁶.

What you get back when you sell

When you sell, the Government is paid its percentage of the sale price. The percentage you get is not affected by changes in the value of your property over time⁶. If you have a 70% share, you get 70% of the selling price and the Scottish Government gets 30%; from your share you must first repay anything you owe your mortgage lender².

The equity percentage paid to the Government is based on the sale price, regardless of whether the property has increased or decreased in value and regardless of whether the sale price is above or below the valuation figure⁶. The buyer information leaflet gives a worked example: an owner with an 80% stake in a home that sells for £140,000 receives £112,000 and the Government receives £28,000²¹.

Improvements do not come back to you separately. Improvements you have made are reflected in the valuation when you sell and are not deducted from the value of the home, but the Government still takes its percentage of the whole price²¹. In the leaflet's example, an owner with an 80% stake who spent £10,000 on improvements and sells for £150,000 receives £120,000, while the Government receives £30,000²¹. If major improvements, such as those needing planning permission or a building warrant, add to the property's value, Scottish Ministers share in that increased value while they still hold a stake⁴.

You are responsible for meeting all the costs of the sale, including those incurred by the administering agent and Scottish Ministers⁶. Repayment of the equity stake is triggered by certain events set out in your shared equity agreement, the most common being the sale of your home⁴.

Rules that limit what you can do with the home

Shared equity ownership comes with conditions. The home is expected to be your sole residence, and permission to let it will not be given⁶. The same rule applied to Help to Buy (Scotland), where the home had to be your only residence, you could not own or part-own any other residential property, and permission to let was refused in any circumstances¹⁵.

If you run into financial difficulty, the safety nets are narrower than for ordinary homeowners. The Home Owners Support Fund operates the Mortgage to Rent and Mortgage to Shared Equity schemes, but buyers of homes under the Scottish Government's funded shared ownership or shared equity schemes may be considered for Mortgage to Rent, not for Mortgage to Shared Equity²². The Scottish Government also cannot buy out a separated partner's share of the property²⁰.

Shared equity or shared ownership: how each works

Scotland also has a shared ownership scheme, and the two are easily confused. Under shared ownership, you buy part of a home from a landlord and pay rent on the part you do not own. Under shared equity, you own the whole home and pay no rent at all; the Government simply holds a percentage stake¹. Priority for shared ownership housing goes to first-time buyers with limited alternatives, members of the armed forces, veterans who left within the past two years, partners of service personnel killed while serving, public sector tenants, families on low incomes and disabled people²³.

The distinction matters across the border too. In England, shared ownership homes are sold by housing associations, local councils and homebuilders²⁴, and the Right to Shared Ownership scheme gives some social tenants the right to buy a stake in their rented home, but that scheme is not available in Scotland, Wales or Northern Ireland²⁵. In Wales, shared ownership eligibility requires you to be buying a share in an eligible home from a participating landlord²⁶. Our comparison page on shared ownership versus shared equity sets out the differences side by side, and the section on first-time buyer schemes covers what each UK nation offers.

Where to get help

The first port of call depends on the scheme. For OMSE, contact the administering agent, Link Homes, which assesses applications, issues passport letters and handles post-purchase requests such as increasing your share or remortgaging². For NSSE, contact the council or housing association selling the home¹⁹. The Scottish Government's buyer information for OMSE and NSSE, published on gov.scot, sets out the full rules⁷.

If you are struggling to keep up with payments, the Home Owners Support Fund may be able to help through the Mortgage to Rent scheme, though shared equity buyers are not eligible for the Mortgage to Shared Equity route²². The Home Owners Support Fund information booklet explains how the schemes work and how the Scottish Government's stake is secured²⁷. For the general mechanics of buying in Scotland, including Home Reports and the offer process, see our guide to buying a home in Scotland, and for the tax you may pay, our page on Land and Buildings Transaction Tax.