Buying your first home is exciting, but it can also be daunting. The good news is there are several government schemes for first-time buyers in England designed to help you get on the property ladder. Some are still available, while others have now closed.
This article focuses primarily on schemes available in England. While some schemes may also apply in Wales, Wales operates separate housing programmes and uses Land Transaction Tax (LTT) rather than Stamp Duty Land Tax. See the short Wales note at the end.
Current Government Help for First-Time Buyers (England)
First Homes (England only)
The First Homes Scheme is a government initiative designed to help first-time buyers purchase certain new-build homes at a discounted price. It forms part of the government’s wider housing affordability policy following the closure of the Help to Buy equity loan scheme.
Eligible first-time buyers may be able to purchase designated First Homes properties at a minimum 30% discount from market value (with some local authorities offering higher discounts, typically up to 50%). The discount is retained in perpetuity when you sell, so the home remains affordable for future buyers.
Key things to know about the First Homes Scheme:
- You must be a first-time buyer to qualify
- Your household income must not exceed £80,000 (£90,000 in London)
- You normally need a mortgage for at least 50% of the discounted purchase price
- The property must be your main residence.
- Discounts are typically 30% off market price – although some local authorities may require a higher discount
- Available on eligible new-build homes in England only
- Local authorities may set local eligibility criteria (e.g local residents or key workers) for an initial marketing period
- Homes are sold with resale restrictions to ensure they remain affordable for future eligible buyers
Find out more here: First Homes Scheme
Lifetime ISA (LISA)
A Lifetime ISA is a savings account designed to help you save for your first home or retirement.
A Lifetime ISA is a savings account that allows eligible individuals to save money with a government bonus.
Key things to know about a LISA:
- Save up to £4,000 per tax year
- The government adds a 25% bonus on contributions – up to £1,000 per year
- Funds can be used to buy your first home valued up to £450,000
- You must be aged 18–39 to open an account
Funds withdrawn for purposes other than buying a first home (subject to conditions) or retirement may be subject to a withdrawal charge.
Find out more here: Lifetime ISA
Shared Ownership Scheme
Shared ownership allows you to buy a share of a property, usually 10–75%, and pay rent on the remaining share.
You can increase your shares over time – known as “staircasing”, helping you move closer to full ownerships.
Key things to know about the Shared Ownership Scheme:
- Designed for first-time buyers and certain households who do not currently own a home
- Typically available to households with a combined income of up to £80,000 (£90,000 in London)
- Available on new-build homes and some resale shared ownership properties
- Offers lower upfront purchase costs compared with buying outright
- Rent and mortgage payments vary depending on the share purchased
Important considerations when buying through Shared Ownership:
- Shared ownership homes are usually leasehold properties
- You will normally pay rent on the share you do not own to a housing association or landlord
- Service charges may also apply, particularly for flats or properties on managed estates
- You may be able to buy additional shares in the property over time through a process called staircasing
- In some cases, staircasing to 100% ownership may convert the property to freehold (depending on the property type and scheme rules)
Buyers should review the lease, rent provisions and service charge arrangements carefully before committing to purchase.
Find out more here: Shared Ownership Scheme
Mortgage Guarantee Scheme (High Loan-to-Value)
This scheme increases the availability of 95% loan-to-value mortgages, making it easier to get on the property ladder with a smaller deposit.
Key things to know about the Mortgage Guarantee Scheme:
- Open to both first-time buyers and existing homeowners
- Available for properties valued up to £600,000
- Offers mortgages with up to 95% loan-to-value (LTV)
- The government guarantees part of the mortgage to participating lenders, reducing lender risk and encouraging availability of high LTV mortgages
Mortgage eligibility and lending criteria are determined by individual lenders.
Find out more here: Mortgage Guarantee Scheme
Stamp Duty Relief for First-Time Buyers
First-time buyers may benefit from reduced Stamp Duty Land Tax (SDLT) when purchasing a property in England, which can help reduce the upfront cost of buying a home.
Key things to know about stamp duty relief for first-time buyers:
- First-time buyers pay 0% Stamp Duty on the first £300,000 of the purchase price
- A 5% rate applies to the portion of the price between £300,001 and £500,000
- First-time buyer relief does not apply to properties priced above £500,000
- To qualify, all buyers must be first-time buyers who have never owned or had an interest in a residential property in the UK or overseas
- The property must be purchased with the intention of being your main residence
If the purchase price exceeds £500,000, the normal residential Stamp Duty rates apply to the entire purchase price.
Stamp Duty Land Tax applies in England and Northern Ireland. Different property taxes apply in Scotland (Land and Buildings Transaction Tax) and Wales (Land Transaction Tax).
Stamp Duty rules and thresholds can change, so buyers should confirm the current position when purchasing a property.
Find out more here: Stamp Duty Land Tax for First-Time Buyers.
Historic first-Time Buyer Schemes
These schemes are no longer available to new applicants.
Help to Buy: Equity Loan
This scheme ran until March 2023 and allowed buyers of new-build homes to borrow from the government:
Key things to know about Help to Buy: Equity Loan:
- Offered a government loan up to 20% of the purchase price (up to 40% in London)
- Required a minimum 5% deposit from the buyer
- Government loan was interest-free for the first 5 years
- Only applied to eligible new-build homes purchased from registered developers
- Repayment calculated based on the property’s market value at the time of repayment.
Although it’s closed to new applicants, many homeowners continue to repay or refinance their Help to Buy equity loans.
Help to Buy ISA
The Help to Buy ISA closed to new accounts in November 2019, but existing account holders can continue to claim the government bonus until November 2029.
Key things to know about the Help to Buy ISA:
- You could save up to £200 a month.
- The government added a 25% bonus on your savings when you used them to buy your first home.
- You could also save up to £1,200 in your first month to boost your savings.
- The maximum government bonus was £3,000 on savings of £12,000.
Making the most of first-time buyer schemes
If you’re buying your first home, it helps to understand what support may be available. Government schemes can reduce upfront costs, support savings, or improve access to mortgages, depending on your circumstances.
Eligibility criteria, property limits and lender requirements may change, so buyers should always check the latest guidance on the official UK government website.
If you’d like guidance on buying your first home or understanding which first-time buyer property schemes may apply to you, our team can help you navigate the process.
Call us on 0333 305 5189 or email info@leadingpropertylawyers.co.uk to speak to a property specialist.
Important notice: This article is for general information only and does not constitute legal or financial advice. Government schemes, tax rules and eligibility requirements may change. Buyers should obtain professional legal and financial advice before making decisions based on this information.
