Good afternoon. The first item of business is a statement by Shirley-Anne Somerville on the first homes fund. The cabinet secretary will take questions at the end of her statement, so there should be no interventions or interruptions.
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I welcome the opportunity to set out to Parliament, in these early days of the new session, the Government’s commitment to tackling one of the defining challenges that our country faces today: access to safe, secure and affordable homes.
Housing remains a central priority for the Government. Bringing it together with social justice, I will be ensuring that the Government delivers a joined-up and strategic approach to tackling poverty, homelessness and the housing emergency while recognising the sector’s importance to the Scottish economy.
Since declaring a national housing emergency last year, we have stood up a co-ordinated national response. Our housing emergency action plan is operational across the country and is delivering a set of focused actions to relieve the most acute pressures, to support local authorities and to accelerate delivery of the homes that people need.
We have delivered substantial progress in responding to the housing emergency, with 75 per cent of the actions having been delivered in the first six months. Crucially, we are making £926 million available this year for the affordable housing supply programme, which is a 21 per cent increase compared with the previous year. Our record investment of up to £4.9 billion over the next four years—£4.1 billion of which is Scottish Government investment—will support the delivery of 36,000 affordable homes, which, it is estimated, will provide homes for up to 24,000 children.
I want a housing system that works for Scotland—one that balances affordability, availability, quality, sustainability and fairness. I am focused on our target of delivering 110,000 affordable homes by 2032, with at least 70 per cent of them being for social rent and 10 per cent of them being in rural and island areas. More than 32,000 affordable homes have been delivered as of 31 December 2025, 77 per cent of which are homes for social rent. It is crucial that there is affordability across all tenures, which will include social rent and affordable mid-market rent, private rented sector rent controls where appropriate, and opportunities for private ownership for those who want it.
For too many people across Scotland, particularly younger people and first-time buyers, home ownership has felt increasingly out of reach. We are hearing the same story in communities the length and breadth of our nation: people are saving what they can, but they are finding that the cost of a deposit is simply too great a barrier. Rising living costs, high rents and broader economic pressures have made it difficult for households to put money aside month after month. Indeed, many are now spending more on rent than they would on a mortgage, yet they remain locked out of ownership because they cannot raise a deposit. That is the context in which the Government will act.
I can confirm today that the Scottish Government will introduce the first homes fund, a demand-led scheme designed to support up to 50,000 first-time buyers over the course of this parliamentary session. The fund will provide a deposit contribution of up to £10,000 towards a home with a property value of up to £300,000 to support individuals and families to take their first step on to the property ladder. The first round of the fund will open to applications by the end of June and, depending on demand, it is expected to support up to 2,000 households within our first 100 days in government.
The fund is a direct response to the experience of people across Scotland. We have listened, and we are taking fast and decisive action.
Often, the single biggest hurdle that first-time buyers face is not their ability to repay a mortgage; it is the difficulty in saving for the initial deposit—the up-front cost that prevents their even entering the market. Too many people cannot rely on financial support from family to bridge that gap, nor should they be expected to. The result is a rent trap: a situation whereby households are locked into paying high rents and are unable to save and, therefore, unable to move forward.
This fund is designed to break that cycle, building on the success of earlier interventions. Previous support helped more than 10,000 households between 2019 and 2022, which demonstrates the scale of demand and the effectiveness of targeted Government support. The fund that I am announcing the details of today will be open to first-time buyers across Scotland and is designed to work alongside wider housing and financial systems. It will complement our low-cost initiative for first-time buyers shared equity schemes, which, since 2007, have helped more than 12,000 people to buy a home.
The first homes fund aims to support first-time buyers and their families. For many families, a home is not just an asset—it is where their children grow, stability is built and futures are shaped. The ambition of the first homes fund scheme is clear: over this parliamentary session, we aim to support up to 50,000 households into home ownership. That is 50,000 households gaining stability, putting down roots in their communities and taking a step towards a more secure future.
We are under no illusion, however, that the scheme alone will solve all the challenges in Scotland’s housing market. That is why it sits in a broader programme of action and is supported by our record levels of investment. We are working with local authorities, housing associations and partners across the sector to increase delivery and improve access, and we are taking measures to ensure that Scotland’s housing system is fair, sustainable and responsive to need.
Let me be clear about what underpins the fund. First, it is fairness. The fund will support all first-time buyers: people who can sustain home ownership but are held back by the initial barrier of a deposit. Secondly, it is simplicity. We will ensure that the application process is clear and accessible, with support available to guide applicants through each stage. Thirdly, it is partnership. We will work closely with lenders, industry partners and stakeholders to ensure that the scheme operates effectively and complements existing products and services. There is already energy and enthusiasm from our partners to ensure that first-time buyers receive our support.
We are also mindful of the wider pressures in the housing system. Scotland continues to face significant challenges, including affordability pressures and supply constraints, and the introduction of the first homes fund is one part of our response to those challenges. It is a targeted intervention to help those who are ready to buy but who cannot yet make that step, and it will be complemented by sustained action on housing supply, planning and infrastructure.
At its heart, the policy is about giving people the tools that they need to build a future. It is about recognising that housing is fundamental not only to our economy but to our wellbeing, our communities and our sense of security. Throughout the opening round of the first homes fund, we will test how it works, to ensure that it is a smooth and simple process with clear guidance and support at every stage, and that it makes a difference to people and their families. We will monitor closely the operation of the scheme to ensure that it works in the interests of buyers and supports a fair housing system. Crucially, we will learn from what that first round tells us, to ensure that the first homes fund remains fit for purpose throughout its duration.
I know—or I hope—that members across the chamber will share the ambition to make home ownership more accessible. I also recognise that there will be scrutiny, questions and debate about how best to achieve that goal. I welcome that. I invite members across the Parliament to work with us to ensure that the fund benefits their local communities, reaches those who need it most and delivers lasting change for the people of Scotland. The issue matters deeply to the people we represent, and it is one on which we must work together, across parties and sectors, to deliver real progress.
I return to the individuals and families whom the policy is designed to support. It will support the young couple who rent and save but never quite reach their target, the key worker who is priced out of the community that they serve and the family who are looking for stability and a place to call their own. From our island communities to our towns and cities, and from rural areas where supply is constrained to urban areas where rents are the highest, the first homes fund will help first-time buyers in every part of Scotland to take that crucial first step. The fund is for them. With it, we are saying clearly that we understand the barriers that they face and that we will act to take those barriers away. We are saying that, for those who need extra support to be able to purchase their first home, the Government will take practical steps in this new session to help them to achieve that. With the first homes fund, we are opening a door not only to home ownership, but to stability, security and opportunity.
I commend the statement to Parliament.
The cabinet secretary will now take questions on the issues raised in her statement. I intend to allow around 20 minutes for questions, after which we will move on to the next item of business. It would be helpful if members who wish to ask a question were to press their request-to-speak buttons now.
I welcome the cabinet secretary to her new, updated role. I welcome any measures that are designed to support aspiring first-time buyers who cannot afford to buy a house, and I look forward to working with the Government to ensure that the first homes fund delivers for our communities.
In that vein, will the Government provide an estimate of the proportion of recipients of the scheme who are expected to come from lower-income households? How will ministers ensure that the scheme primarily benefits first-time buyers who face the greatest affordability barriers, when the Government closed the previous fund on the basis that 72 per cent of recipients did not need to use it to purchase their first home? How will the Government ensure that the scheme supports housing supply, particularly in high-pressure markets, where there is concern that additional purchasing power risks artificially inflating prices?
I welcome Mark Griffin to his new post, and I look forward to working with him again.
Today, we are presented with an example of the opportunity that members have to work together across the chamber. Mr Griffin has raised points about how the scheme should act and the lessons that we should learn. I reassure him that we have learned lessons from previous schemes. For example, the scheme will be available for homes with a property value of up to £300,000. In that respect, it is different from the schemes that have operated in the past.
We are also learning about the fact that although our other low-cost home ownership schemes help, they do not take away all the barriers. Different people face different barriers, and the first homes fund represents another opportunity to tackle those barriers.
This morning, the First Minister and I went on a visit and spoke to developers. We heard at first hand their hope and expectation that the first homes scheme will immediately be able to help people who wish to become first-time buyers but who are not able to. We have tried to present the scheme in a simple way, and the property value threshold will help the people who need help the most.
As with all issues in my portfolio, I will be happy to work with Mr Griffin on the further details of the scheme as we go about learning for the next round.
I welcome the cabinet secretary to her post and thank her for providing advance sight of the rhetoric that we have heard. Bluntly, that is exactly what her statement is. It is yet another wasted opportunity from a failing Government. It is another gimmick, not a real solution. The cabinet secretary should know that the Government cannot spend 20 years digging a hole and then expect applause for arriving with a ladder.
Although there are bits of the statement that I and Reform welcome, including the proposals to help first-time buyers, we await the detail. Let us be honest—the policy will not even scratch the surface when it comes to tackling the housing emergency. The statement includes nothing of substance on social housing, nothing on planning reforms—it does not tell the country who the planning minister is—or on cutting red tape and bureaucracy to make building easier for developers, and nothing on the provision of assistance to people who are struggling in working-class communities such as mine, many of whom can only dream of having large savings to set aside for a deposit. Today’s announcement will do very little to help them. The cabinet secretary knows that a pathetic 10,000 quid handout will not work. It is a smokescreen simply to grab headlines instead of delivering. Indeed, the likelihood is that prices will rise across the country.
Question.
If the cabinet secretary is serious about tackling the housing emergency, rather than focusing on a party-political gimmick, will she put back in place local connection for social housing and finally prioritise local people over strangers who have arrived here illegally?
I will try hard, in my first discussion with Mr Kerr, to very gently say a few things to him.
This is a statement about the first homes fund. That is why it talks about the first homes fund. We can discuss other things in questions following other statements and in other debates in due course. He can, indeed, speak to the minister with responsibility for planning, who is sitting right behind me, if he wishes to discuss planning.
I will try not to take it to heart, but I am genuinely disappointed by the fact that Mr Kerr has, I presume, just read out a bit of the press release that he is about to issue on this matter. Once he has done that and we have got past the rhetoric, I will work together with him if he wishes to come forward with proposals and suggestions. I will perhaps leave my comments there for the moment.
How will the first homes fund work in rural and island areas such as Argyll and Bute, where it can be difficult for first-time buyers and their families to take their first steps on the property ladder because of the affordability and supply constraints that the cabinet secretary has referenced in her statement?
Jenni Minto raises an important point, and the issue of ensuring that the scheme works for all parts of Scotland is a challenge that we must rise to—I alluded to that in my statement. That is why we are taking a whole-Scotland approach. The scheme can work effectively in rural areas, alongside the other rural and island support that the Government has for key workers and for housing in general.
It is a demand-led scheme and will be open to applicants across Scotland, including, of course, all areas of Argyll and Bute. As I said to Mr Griffin earlier—I address this suggestion to Mr Kerr, too—if, during the learning that takes place in the first phase, members come back to us about aspects of the scheme that can be adapted to ensure that it works for all areas, we will be keen to learn from them and we are keen to support members in that regard. The scheme will work for rural and island areas, and I value Ms Minto’s contribution to allowing the Government to do that most effectively.
The previous iteration of the fund—the first home fund—underperformed in rural Scotland, with remote and island areas representing only 1.3 per cent of supported sales in 2019-20. I heard the cabinet secretary’s response to Jenni Minto, and I appreciate what she said. I note that the target for rural house building is set at 10 per cent in rural areas. Will the cabinet secretary apply a similar target to the proportion of the first homes fund that will be targeted in rural areas?
I welcome Donald MacKinnon to the chamber. I welcomed him to the Parliament privately yesterday, after his first speech. It was an exceptionally good first contribution, and I look forward to working with him on issues to do with island housing.
Like Jenni Minto, Mr MacKinnon is quite right to challenge the Government to ensure that the scheme works across Scotland. There are challenges around the island housing market, which present challenges to first-time buyers in particular. However, the scheme can work right across Scotland, including in his constituency.
I am not minded at this stage to have targets in different areas, but if, during this first phase, Mr MacKinnon feels that the arrangements are presenting a challenge to his constituents, I am more than happy to pick that up with him in due course.
It is fantastic to hear the cabinet secretary roll out the manifesto commitment on the first homes fund so quickly. Will there be any consideration of regionalisation or prioritisation of funding, or will it remain a Scotland-wide fund? Will there be consideration of a review of the success of the scheme that will consider the impact on house prices and, hopefully, a positive uptick in what is now a more sluggish new-build housing market?
As I said to Donald MacKinnon, I am not minded, at this stage, to look at regionalisation or the prioritisation of funding in this open round, but I am keeping an open mind on that.
One aspect that is being discussed with stakeholders, including house builders, is how we ensure that the fund works for new build as well as existing properties, and what implications there are for the market. However, I go back to the points that the First Minister and I heard this morning—that there is a keen demand out there for a fund such as this one and an appreciation among developers that it could be a tipping point for someone’s being able to afford their first home.
I do not think that we need to look at regionalisation to get success from the scheme. However, the member can make that point, if he wishes to do so, once we have learned from the first round of the scheme.
We all want the scheme to work, so it is important that we try to learn lessons in the first round. My question to the cabinet secretary—[Interruption.]—if I could stop being heckled, because it is a serious question and Stephen Flynn may want to listen to it, is, how will we guard against people who have money using the scheme and taking advantage of it?
One important way in which we will look at the success of the scheme is in how we help people with the pressure of the cost of living. I am mindful of the fact that someone’s ability to own their own home is very much to do with the affordability of the deposit and the mortgage versus the rent; however, it is also to do with their energy costs, which, again, are just about to increase, as we heard this morning. Food inflation is still expected to be exceptionally high.
It is important that we recognise that, across Scotland, many people in our communities are struggling with not just the cost of housing but the cost of living across a variety of areas. That is why it is important that, in looking to help with our first homes fund, we recognise that it will help with the pressures of the cost of living for many families and individuals across Scotland. It will help them to bear the burden of other costs that we do not have the powers to impact, such as energy—we will come back to that tomorrow. We also hope to help people with the cost of their food bills.
I am delighted to see the first homes fund progressing to deliver much-needed support to first-time buyers. The issue was certainly a hot topic in my Rutherglen and Cambuslang constituency during the election.
Previously, the Government offered support in that area via the first home fund and the LIFT scheme. What lessons has the Government taken forward from those initiatives?
One important lesson led to the introduction of the property cap maximum of £300,000. The need to better target support to individuals who might not otherwise be able to purchase their first home was a key lesson that we learned.
As I have said to members across the chamber, we are committed to monitoring the effectiveness of the first round, but I believe that it is important that we get that started by the end of June, so that we can provide that support to people across Scotland, as we promised in our document, “100 Days of a New SNP Government”. However, in addition to learning from past schemes, the new scheme will be evidence led, and we will ensure that we optimise the fund for its full five-year delivery.
Another important point is the fact that it is a multiyear scheme, to provide reassurance to not just those who are looking to buy a home but developers and those in the private sector.
Although I share the cabinet secretary’s ambition for homes, I have concerns. Evidence from previous help-to-buy schemes is that they make properties less affordable, not more. An evaluation by the London School of Economics found that a scheme in London caused a 6 per cent rise in house prices, with no increase in supply at all.
The average deposit for a home last year was more than £43,000, so the scheme would still require the buyer to find more than £30,000. Does that not risk providing help to those who are already better off, as we have seen in previous schemes?
No, I do not think that it does. I go back to one of the points that was alluded to in my visit this morning. It is about ensuring that those who want to own their own home—home ownership is not for everyone—get additional support to be able to do so. It will also allow those people to move out of private rented or mid-market rent accommodation, which will allow someone else to get into a different part of the affordable housing system.
The fund is important for first-time buyers, but we must also recognise the flexibility that it can give the housing market in order to support mid-market rent, the private rented accommodation sector and social housing. That is another important part of the scheme.
I welcome the cabinet secretary back to her portfolio, which has been extended, and make a plea that Scotland’s housing emergency be prioritised. Analysis of the previous first homes fund found that around 68 per cent of buyers had household incomes that were above the Scottish median, which meant that the policy did not benefit people on lower incomes. We need immediate relief if we are to get people on to the housing ladder and tackle Scotland’s housing emergency. Does the cabinet secretary not agree that we can help those people now by backing the Scottish Conservatives’ idea to abolish land and buildings transaction tax for people buying their first home, because that would encourage aspiration and help people to get on to, and move up, the property ladder?
If that continues to be the Scottish Conservatives’ policy, and if the party wishes to take a different approach to forthcoming Scottish Government budgets and to have costed discussions about whether to take the tax away and the implications that that will have for spending, I am sure that the Deputy First Minister will be delighted to hear Meghan Gallacher’s detailed and costed proposals.
As I said to Ariane Burgess, it is important to recognise that this is not only about support for first-time buyers—important though that is—but about the support that can be given to those who will then move into the private rented sector, mid-market rent housing or an affordable social home. We will design the scheme to ensure that it helps people. I go back to the property value limit that has been put on the scheme; it is important to recognise the flexibility that that will provide, to ensure that others can benefit from other parts of the affordable housing supply.
The first homes fund’s success undoubtedly goes hand in hand with the wider housing sector’s success in Scotland. Can the cabinet secretary speak more about the Scottish Government’s plans to increase our housing stock by maximising growth and investment?
As I touched on in my statement, the scheme is one part of the wider support that the Scottish Government will give the housing market. It is important that we recognise the social rented supply, which is exactly why we are making £926 million available for the affordable housing supply programme, which will help with social rent, mid-market rent and low-cost home ownership. That is £4.1 billion of Scottish Government investment that will go in over the next four years, which shows this Government’s determination to take the housing situation exceptionally seriously and to work not only to assist those who wish to own their own home but to help others across the affordable housing supply programme and across Scotland.
The cabinet secretary knows that Liberal Democrats will always be constructive, as we have been for a number of years. We are still in the midst of a housing emergency—it is an emergency—but she has not answered the question about the scheme potentially providing a subsidy to those who can already afford to buy their own home. I will give her another chance to explain what lessons she has learned from previous schemes so that that does not happen.
Let me try again for Willie Rennie. I am sure that he will tell me if I have once again not succeeded in explaining it. One of the important lessons that we have learned relates to the £300,000 property value limit that we have placed on the fund. The scheme is much more targeted than our previous schemes, which is important. We will ensure that the scheme is targeted and in place not only for buyers right across Scotland but for those who are buying their first home at the lower end of the market.
I appreciate that members might wish for different criteria to be included in the scheme. I have a preference for it to be as simple as possible for the buyer and for the lenders taking part in the wider transactions.
If Mr Rennie is still not convinced—I am looking at his face, and I think that he is not—I would be happy to work with him, as I have done in the past, because it is important that we get the most out of the scheme and that we support the people right across Scotland who need it. I believe that the fund does that because of the changes that have been made and the lessons that we have learned from the past.
I am happy to work with Mr Rennie if he is yet to be convinced by my argument.
I am pleased to see the support for first-time buyers and the recognition of how difficult it can be to pull together a deposit when you are living rent payment to rent payment. Will the Government explain how it will work with mortgage providers to ensure that deposit requirements are not simply uplifted as a result of the scheme?
Emma Roddick makes the important point that we need to work with mortgage lenders and those with an interest in the first-time buyers market to ensure that we support people and that that support makes a genuine difference to them.
Such schemes have been available in the past, but, as I said to Mr Rennie, this one is more targeted. We take very seriously the lessons that we have learned from those schemes about how we work with lenders.
Further details of the scheme will, of course, be made available before it opens at the end of June. That will include information about how we have worked with lenders to give exactly the types of reassurance that Emma Roddick has suggested.
I thank the cabinet secretary for her statement, and I welcome her to her newish role.
A scheme of £100 million would mean approximately £20 million per year. Ending homelessness together, the Government’s flagship fund for tackling homelessness, provides just more than half of that—£11.5 million of funding this financial year. That £100 million could also build more than 500 social homes. What does the cabinet secretary have to say to people who are waiting years and years for a social home or, indeed, to those who have no home at all? Why is the Government prioritising people who can already afford a home and people who want to buy a home over those without somewhere safe to live?
That is quite an unfair assessment, if I may say so. However, I thank Maggie Chapman for welcoming me to my nearly new role.
It is important that the Government is there to support people across Scotland in all tenures. I deeply value the importance of the social rented sector, and I welcome the role of councils and housing associations in supporting people in the social rented sector.
The private rented sector is also important to people in Scotland, as is private owner occupation. I do not put one above another. As I have said to other members in relation to the cost of living crisis, it is important that we are there to support people regardless of the tenure that they are in and the tenure that they wish to be in.
As I said in my statement, providing support for first-time buyers is one area that the Government is working on, but as I also alluded to, there are other strands of the Scottish Government’s work that will support affordable housing in general. I go back to the £926 million this year for the affordable housing supply programme to support people in the social rented sector, in the mid-market rent sector and in low-cost home ownership.
The cabinet secretary talked about monitoring the outcomes of the policy as it evolves. Will she tell me what that means in practice in detail, in relation to her objectives for the policy?
The essence of the test-and-learn approach is to ensure that, as the first wave of the project is launched at the end of June, we ensure that we are continuously speaking to private developers, lenders and others to measure the impact.
At the start, the scheme will be quite small, but—as I said in my statement—if the demand is there, it could support 2,000 households in the Government’s first 100 days. That will give us a good basis on which to work with lenders, developers and others to ensure that we receive their feedback on how the scheme can be developed. As I have said to a number of members, I would welcome members’ thoughts and contributions on the lessons learned from the impact on their constituencies as we move forward.
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