diff --git a/data/core/commands/core.lua b/data/core/commands/core.lua
index cf904ccf..404642c3 100644
--- a/data/core/commands/core.lua
+++ b/data/core/commands/core.lua
@@ -7,6 +7,33 @@ local LogView = require "core.logview"
 
 local fullscreen = false
 
+local function home_encode(paths)
+  if not HOME then return paths end
+  local home = HOME
+  local t = {}
+  local n = #home
+  for i = 1, #paths do
+    if paths[i]:sub(1, n) == home and paths[i]:sub(n + 1, n + 1):match("[/\\\\]") then
+      t[i] = "~" .. paths[i]:sub(#home + 1)
+    else
+      t[i] = paths[i]
+    end
+  end
+  return t
+end
+
+local function home_expand(text)
+  if HOME then
+    return text:gsub("^~", HOME)
+  end
+  return text
+end
+
+local function suggest_directory(text)
+  text = home_expand(text)
+  return home_encode(text == "" and core.recent_projects or common.dir_path_suggest(text))
+end
+
 command.add(nil, {
   ["core:quit"] = function()
     core.quit()
@@ -126,6 +153,7 @@ command.add(nil, {
 
   ["core:change-project-folder"] = function()
     core.command_view:enter("Change Project Folder", function(text)
+      text = home_expand (text)
       local path_stat = system.get_file_info(text)
       if not path_stat or path_stat.type ~= 'dir' then
         core.error("Cannot open folder %q", text)
@@ -134,21 +162,18 @@ command.add(nil, {
       if core.confirm_close_all() then
         core.open_folder_project(text)
       end
-    end, function(text)
-      return text == "" and core.recent_projects or common.dir_path_suggest(text)
-    end)
+    end, suggest_directory)
   end,
 
   ["core:open-project-folder"] = function()
     core.command_view:enter("Open Project", function(text)
+      text = home_expand (text)
       local path_stat = system.get_file_info(text)
       if not path_stat or path_stat.type ~= 'dir' then
         core.error("Cannot open folder %q", text)
         return
       end
       system.exec(string.format("%q %q", EXEFILE, text))
-    end, function(text)
-      return text == "" and core.recent_projects or common.dir_path_suggest(text)
-    end)
+    end, suggest_directory)
   end,
 })
diff --git a/src/main.c b/src/main.c
index f982e12d..6b05b769 100644
--- a/src/main.c
+++ b/src/main.c
@@ -132,14 +132,12 @@ init_lua:
     "    DATADIR = prefix and (prefix .. '/share/lite-xl') or (EXEDIR .. '/data')\n"
     "  end\n"
 #endif
-    "  do\n"
 #ifdef _WIN32
-    "    local home = os.getenv('USERPROFILE')\n"
+    " HOME = os.getenv('USERPROFILE')"
 #else
-    "    local home = os.getenv('HOME')\n"
+    " HOME = os.getenv('HOME')"
 #endif
-    "    USERDIR = home and (home .. '/.config/lite-xl') or (EXEDIR .. '/user')\n"
-    "  end\n"
+    "  USERDIR = HOME and (HOME .. '/.config/lite-xl') or (EXEDIR .. '/user')\n"
     "  package.path = package.path .. ';' .. USERDIR .. '/?.lua'\n"
     "  package.path = package.path .. ';' .. USERDIR .. '/?/init.lua'\n"
     "  package.path = DATADIR .. '/?.lua;' .. package.path\n"