Government schemes for first time buyers in 2026

The First Homes scheme

First Homes is a government-backed home ownership scheme designed to help first time buyers onto the property ladder in England. The scheme may allow eligible buyers to purchase a home at 30% to 50% below market value.¹ Since the discount applies to a home’s full market value, this may result in a lower deposit requirement and potentially smaller mortgage payments.

How does the First Homes scheme work?

Eligible first time buyers can buy new-build properties built by developers or properties previously purchased through the scheme at 30% to 50% below market value. The property you’re buying must be £250,000 or less after the discount has been applied (£420,000 or less in London). If you sell the property, the discount you received is passed to the buyer, who must also be eligible for the scheme.

Who is eligible for the First Homes scheme?

To join the First Homes scheme, you must be a first time buyer over the age of 18. You must also be purchasing a property in England and earn less than £80,000 per year (£90,000 in London).

Local councils can determine their own eligibility criteria and may prioritise key workers, local residents or individuals with lower incomes.

Eligibility checklist for the First Homes scheme

According to GOV.UK, you must:

• Be 18 or older

• Be a first time buyer

• Be able to get a mortgage for at least half the price of the home

• Not earn more than £80,000 a year before tax (£90,000 if the property is in London) - this is your income from the previous tax year

The requirements differ slightly if you’re buying with others. In this case, you must:

• All be first time buyers

• Apply together, even if you’re not all getting a mortgage

• Have a joint income less than £80,000 a year before tax (£90,000 if the property is in London)

For local eligibility set by councils and exemptions for armed forces and their families, check government advice.

Pros and cons

The First Homes scheme has both advantages and disadvantages. In the table below, we outline some key considerations.

The Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme (also known as Freedom to Buy) can help homebuyers with a deposit as small as 5%. The scheme protects the availability of 91-95% loan-to-value (LTV) mortgages by providing participating lenders with a government-backed guarantee. This insures lenders against a portion of their potential losses on those mortgages.

The scheme has been permanently available across the UK from July 2025 and can support purchases on homes up to £600,000.

Lenders remain responsible for affordability checks, and your application will follow the usual mortgage process. You can find more in the 2025 Mortgage Guarantee scheme rules.

Who is the Mortgage Guarantee Scheme for?

This scheme may be suitable for:

• First time buyers who have a smaller deposit saved

• Applicants who meet lenders’ affordability criteria

• Those considering homes within the scheme’s price cap of £600,000

It may not be suitable:

• Buyers with low credit scores

• Those considering alternatives such as equity loans or discount‑based schemes

• Those looking for a deposit‑free or low‑equity product

Lifetime ISA (LISA)

A LISA is a long‑term savings product that includes a government bonus. The government adds a 25% bonus to what you save, up to a £1,000 bonus per year. It can be used for your first home deposit if the home costs £450,000 or less. ²

Who is eligible for a LISA?

You must be aged 18 to 39 to open a LISA, and the account must be open for at least 12 months before the bonus can be used. You must also be a resident in the UK, or a member of the armed forces or a crown servant (or their spouse or civil partner if you do not live in the UK). ³

How can a LISA be used to buy your first property?

You can withdraw money from your LISA if all of the following apply:

• Your new home costs £450,000 or less

• You're buying at least 12 months after you make your first payment into the LISA

• A conveyancer or solicitor acts for you in the purchase – funds will be paid directly to them

• You’re buying with a mortgage

You may face a withdrawal charge of 25% if funds are taken out for non‑qualifying reasons. ⁴

When can you not use a LISA to buy your first property?

You cannot use your LISA to buy your first home if you’re getting a private mortgage from:

• A relative

• Someone who is married or in a civil partnership with your relative

• Your spouse or civil partner

• A relative of your spouse or civil partner

• Someone who is married or in a civil partnership with a relative of your spouse or civil partner

How is the LISA bonus paid?

You must use a solicitor or conveyancer to act on your behalf when purchasing your first property to be eligible for the bonus. Once you’re ready to buy, they claim the bonus for you, and the provider pays the funds directly to them.

Can you use a Help to Buy ISA and a LISA for your first home?

You can only use the government bonus from one of your ISAs to buy your first home. If you want, you can transfer money from a Help to Buy ISA to your LISA. If you transfer money from your LISA to your Help to Buy ISA, you will have to pay a 25% withdrawal charge.

Shared Ownership

Shared Ownership allows eligible first time buyers to purchase a initial share of a home (between 10% and 75%) and pay reduced rent on the remaining share. You can usually increase your share through staircasing over time. The rules for Shared Ownership properties differ across England, Scotland, Wales and Northern Ireland.

Who is eligible for the Shared Ownership scheme?

First time buyers can purchase a property through a Shared Ownership scheme if they have a household income of £80,000 per year or less (£90,000 per year or less in London) and can’t afford the full deposit and mortgage payments for a home that meets their needs.

What costs can you expect from a Shared Ownership home?

Through a Shared Ownership property, you will be expected to make monthly payments. The costs you can expect to pay include:

• The initial share, between 10% and 75% of the home’s full market value

• Monthly rent payments to the landlord for the share they own (e.g. if you buy a 10% share, you pay 90% rent to the landlord)

• If your property has ground rent and service charges, you pay these monthly, too

What is staircasing?

Staircasing allows you to increase the ownership of your property in stages, often up to 100%. As you buy more shares, you pay less rent.5

It may be worth reviewing available staircasing options with the provider before committing to a purchase.

Help to Buy – Wales

Help to Buy – Wales offers Equity Mortgages to buyers of new-build homes, providing up to 20% of the purchase price. The scheme only supports purchases bought through a participating builder with a maximum price of £300,000.⁶ The property must also have an EPC rating of B or above.7

With Help to Buy – Wales:

• You must provide a 5% deposit

• You must take out a repayment mortgage to cover the remaining amount

Visit GOV.WALES for more information.

Do first time buyers have to pay Stamp Duty?

In England, you might be eligible for Stamp Duty discounts and reliefs if you’re a first time buyer.

Eligible buyers don’t pay Stamp Duty on homes up to £300,000, and 5% on the portion from £300,001 and £500,000. After this, standard rates apply. ⁸

Expert view: What to check before you apply

‘Being a first time buyer doesn’t mean you automatically qualify for every scheme, so it’s important to check your eligibility and review government guidance. This can save you wasting time on applic

Ready to become a homeowner? Explore our range of brand-new homes across the UK and learn more about our homebuying offers to help you move. Please note that terms and conditions apply.

References: 

1. https://www.gov.uk/first-homes-scheme ↩
2. https://www.gov.uk/lifetime-isa ↩
3. https://www.gov.uk/lifetime-isa/who-can-open-a-lifetime-isa ↩
4. https://www.gov.uk/lifetime-isa/withdrawing-money-from-your-lifetime-isa ↩
5. https://www.gov.uk/shared-ownership-scheme/who-can-apply ↩
6. https://www.gov.wales/help-buy-wales/eligibility ↩
7. https://www.gov.wales/help-buy-wales/repaying-shared-equity-loan ↩
8. https://www.gov.uk/stamp-duty-land-tax/residential-property-rates ↩