Under the announced Your First Home terms, eligible first-time buyers purchasing qualifying new-build homes in England can seek a 20% equity loan with a deposit from 2.5%. Applications are scheduled to open in February 2027.
UK Chancellor John Healey confirmed £4.7bn over five years for Your First Home in the 28 October 2026 Budget. The scheme will support first-time buyers purchasing new-build homes in England with deposits as low as 2.5%. Healey said it would help 70,000 households buy a home.
Andy Burnham unveiled Your First Home in September, the Guardian said, following Help to Buy’s closure in 2023. The government’s 26 September 2026 announcement left costs and launch dates for the Budget.
Total annual household income must be £110,000 or less outside London, or £140,000 or less within London. Buyers must be first-time buyers purchasing an eligible new-build home from a participating developer, within the local property-price cap. The property must normally be their main home.
Meeting the income and deposit limits does not guarantee a mortgage. A participating lender must approve the buyer after affordability and credit checks. The government says it will manage funding allocations with developers and keep demand under review.
The government has announced the following price caps but says the full local-authority list will be published “shortly”; it has not given a publication date. Rightmove’s analysis shows how much of the advertised new-build market falls below four of the announced limits.
| Area |
|---|
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| Share below cap |
|---|
| Inner London | £650,000 | 35% |
| Outer London | £500,000 | 46% |
| Reading | £375,000 | 20% |
| North Devon | £320,000 | — |
| Manchester | £355,000 | — |
| Middlesbrough | £220,000 | 18% |
Buyers will receive a government equity loan worth 20% of the purchase price. An equity loan is linked to the home’s value, so the amount eventually repaid can change. Buyers must provide a deposit between 2.5% and 15% and obtain a repayment mortgage for the balance. With the minimum deposit, that mortgage covers 77.5% of the price.
| Funding | Your First Home | Standard 95% mortgage |
|---|---|---|
| Buyer’s deposit | £7,500 | £15,000 |
| Government equity loan | £60,000 | £0 |
| Repayment mortgage | £232,500 | £285,000 |
The Treasury says buyers will own their home from completion; the government will not be a joint owner or landlord.
The government’s illustration puts monthly payments £282 lower during the first five years than with a standard 95% mortgage. It assumes a £300,000 purchase, a 30-year repayment mortgage at 5%, a £60,000 equity loan and no repayment of that equity loan during the period shown. Deposits are 2.5% under the scheme and 5% for the comparison mortgage.
| Period | Equity-loan interest rate | Monthly equity-loan interest | Your First Home total | Standard 95% mortgage |
|---|---|---|---|---|
| Years 1–5 | 0% | £0 | £1,248 | £1,530 |
| Year 6 | 1.5% | £75 | £1,323 | £1,530 |
| Year 7 onwards | 3% | £150 | £1,398 | £1,530 |
Equity-loan interest is paid separately from the mortgage and does not reduce the equity loan owed. The illustration is not a mortgage quote: actual costs depend on the property, the offered mortgage rate and the buyer’s circumstances. It excludes mortgage fees, insurance, council tax, service charges, estate charges and maintenance.
The equity loan will normally be repaid when the home is sold, although buyers can repay some or all of it earlier. A loan covering 20% of the original purchase price will normally require repayment of 20% of the home’s independently assessed value at repayment. The amount owed therefore rises or falls with the property’s value.
For the government’s £300,000 purchase example, the original £60,000 equity loan would require £64,000 to repay if the home’s value rose to £320,000. If its value fell to £280,000, repayment would be £56,000.
| Term | Your First Home | Final Help to Buy scheme |
|---|---|---|
| Minimum deposit | 2.5% | 5% |
| Equity loan | 20%, including London | 5–20%, or up to 40% in London |
| Household-income cap | £110,000 outside London; £140,000 within London | None |
The new scheme halves the minimum deposit but offers a smaller maximum equity loan in London than its predecessor.
The government says the scheme is intended to reduce the deposit barrier and support new-home building. Participating developers must sign an agreement and pay fees towards running costs.
Before applications open, the government plans to publish full eligibility rules, eligible-home and participating-provider details, and application instructions. Further guidance will cover interest collection and repayment, including minimum repayments, valuations, possible fees, sales and remortgaging.
Applications are not open yet. Customer pre-registration and initial guidance are scheduled by the end of December 2026, followed by applications in February 2027 and the first loans and property sales in April 2027.
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