Open Market Shared Equity Scheme

Shared equity means that the Scottish Government will keep a financial stake in the property so you do not have to fund all of it. You will pay for the majority share in the property – normally between 60 and 80 per cent of the price – and the Scottish Government will hold the remaining share under a shared equity agreement which they will enter into with you. You will own the property outright but the interests of the Scottish Government will be secured by a mortgage (or a ‘standard security’ as it is known in Scotland) on that property.

OMSEP mainly aims to help first-time buyers. But it can help others too. For example, it may be able to help you if you are looking for a new home after a significant change in your household circumstances or if you have a disability and own a house which doesn’t suit your needs. If you currently own your home or part-own a property, you will need to sell your interest in that property at the same time that you buy a home through the OMSEP.

You will be assessed by the registered social landlord operating the scheme (for  Dundee this is Link Homes who can be contacted on 08451 550019) to see whether or not you qualify. To allow this to happen, a form of ‘means testing’ will be carried out. You will need to show that you cannot buy a house suitable for your needs without help from the OMSEP.

The amount that you contribute must be the maximum mortgage you can reasonably obtain and afford plus any personal contribution that you are able to make. However, the registered social landlord will be able to give you information on the income multipliers it uses when considering the level of mortgage finance you can raise. You should not exceed these unless you have received independent financial advice as you need to be confident that you can pay your mortgage over the long term, even if mortgage interest rates or other living costs increase. The overall amount must be enough to pay for your stake and cover all the costs of buying a home, such as legal costs.

If, for example, you purchase an 80 per cent stake in your property when you want to move, then you will get 80 per cent of the selling price when it is sold. The Scottish Government will receive the remaining 20 per cent. The percentage you get is not affected by changes in the value of your property over time.