New Supply Shared Equity administrative procedures

Guidance for registered social landlords and grant providers on New Supply Shared Equity (NSSE) administrative procedures.


Annexe H: Financial reconciliation - equity stake increases

This example shows what would happen if an owner in a Type 1 project decides to increase the equity stake in their property from 65 per cent to 85 per cent and then from 85 per cent to 95 per cent and then from 95 per cent to 100 per cent. There is no golden share over the property.

 
Open market valuation (1 year after the owner has taken entry of the property 130,000
Owner's equity stake (65 per cent of £130,000) 84,500
The Scottish Ministers' equity stake (35 per cent of £130,000) 45,500
Owner then increases their equity stake to 85 per cent:
Owner's new equity stake (85 per cent of £130,000) 110,500
Owner's receipt to the Scottish Ministers (£110,500 - £84,500) 26,000
The Scottish Ministers' equity stake decreases to 15 per cent:
The Scottish Ministers' new equity stake (15 per cent of £130,000) 19,500
Registered social landlord pays the receipt to the Scottish Ministers 26,000
Open market valuation (3 years after the initial purchase) 140,000
Owner's equity stake (85 per cent of £140,000) 119,000
The Scottish Ministers' equity stake (15 per cent of £140,000) 21,000
Owner then increases their equity stake to 95 per cent:
Owner's new equity stake (95 per cent of £140,000) 133,000
Owner's receipt to the Scottish Ministers (£140,000 - £119,000) 21,000
The Scottish Ministers' equity stake decreases to 5 per cent:
The Scottish Ministers' new equity stake (5 per cent of £140,000) 7,000
Registered social landlord pays the receipt to the Scottish Ministers: 21,000
Open market valuation (4 years after the initial purchase) 142,000
Owner's equity stake (95 per cent of £142,000) 134,900
The Scottish Ministers' equity stake (5 per cent of £142,000) 7,100
Owner then increases their equity stake to 100 per cent
Owner's new equity stake (100 per cent of £142,000) 142,000
Owner's receipt to the Scottish Ministers (£142,000 - £134,900) 7,100
Registered social landlord pays the receipt to the Scottish Ministers: 7,100

Contact

HousingMarkets@gov.scot

Back to top