Buying a first home could become more accessible under a new government-backed housing scheme announced for England.
On 26 September 2026, the Government announced plans for a new equity loan scheme called Your First Home. The scheme is expected to allow eligible first-time buyers to purchase a new-build property with a cash deposit of just 2.5%, supported by a government-backed equity loan of 20%. GOV.UK
The scheme has not yet fully launched. Important details, including eligibility requirements, property price limits, costs and the implementation timetable, are due to be confirmed at the Budget. GOV.UK
What Is the Your First Home Scheme?
Your First Home is a proposed equity loan programme designed to reduce one of the biggest barriers facing first-time buyers: saving a large enough deposit.
Under the plans announced so far, eligible first-time buyers purchasing a qualifying new-build property in England would be expected to contribute a deposit of 2.5% of the purchase price. The Government would then provide an equity loan worth 20% of the property’s value. GOV.UK
For example, on a property costing £400,000:
- 2.5% buyer deposit would equal £10,000
- 20% equity loan would equal £80,000
- The remaining £310,000, or 77.5%, would need to be funded through a mortgage or other arrangements permitted under the final scheme rules
This is only an illustrative calculation. Mortgage affordability, lending criteria and the final scheme conditions will still apply.
Who Will Be Eligible?
The Government has confirmed that the scheme is intended for prospective first-time buyers purchasing new-build homes from developers participating in the scheme. GOV.UK
However, Your First Home will not simply be available to every first-time buyer.
The Government has said the programme will include:
- Household income limits
- Local property price caps
- Participating developer requirements
- Restrictions to qualifying new-build properties in England
The exact income thresholds and property price limits have not yet been published and are expected to be announced at the Budget. GOV.UK
Will the 20% Equity Loan Be Interest-Free?
The Government has confirmed that the equity loan will include an initial interest-free period. The exact length of that period and the charges that may apply afterwards have not yet been confirmed. GOV.UK
This is an important detail for buyers because an equity loan is different from receiving a grant or discount.
With previous equity loan schemes, the Government held an equity interest linked to the property’s value. Buyers should therefore wait for the official Your First Home repayment terms before assuming it will operate exactly like previous Help to Buy arrangements.
Is Your First Home the Same as Help to Buy?
No. Your First Home is a new scheme.
There are similarities because both involve government-backed equity loans and new-build properties, but buyers should not assume the rules will be identical.
Under the previous Help to Buy Equity Loan programme, buyers generally needed at least a 5% deposit, while the Government could provide an equity loan of up to 20% outside London and up to 40% in London under earlier versions of the programme. GOV.UK
The proposed Your First Home scheme is different because it is expected to support deposits from just 2.5%, with a 20% government-backed equity loan. GOV.UK
What Could the Scheme Mean for First-Time Buyers in London?
For first-time buyers in London, raising a deposit can be particularly challenging because property prices are generally higher than in many other parts of England.
A 2.5% deposit could substantially reduce the amount of cash required upfront.
For example:
| Property Price | 2.5% Deposit |
|---|---|
| £300,000 | £7,500 |
| £350,000 | £8,750 |
| £400,000 | £10,000 |
| £450,000 | £11,250 |
| £500,000 | £12,500 |
However, a smaller deposit does not automatically mean that a buyer will qualify for a property.
Mortgage affordability assessments, income, existing debts, credit history and the scheme’s eventual local property price and household income caps will still be important considerations.
When Will Your First Home Start?
A launch date has not yet been confirmed.
The Government has said further information, including the cost of the programme and its implementation timetable, will be announced at the Budget. GOV.UK
This means prospective buyers should treat the current information as an announced proposal rather than a scheme that can already be applied for.
What Should First-Time Buyers Do Now?
If you are considering buying your first property, it can still be useful to start preparing before the full scheme opens.
Understanding how much you can realistically borrow, reviewing your savings and deposit, keeping your finances organised and researching suitable areas can put you in a stronger position once the final eligibility requirements are announced.
Buyers interested specifically in Your First Home should wait for the official rules before making financial commitments based on the 2.5% deposit figure.
Looking for Your First Home in London?
PrimeLand Property works across London and can help buyers explore available properties and understand the local property market.
As further details of the Your First Home scheme are announced, we will continue to provide updates on what the changes could mean for first-time buyers.
Contact PrimeLand Property to discuss buying a property in London:
📞 0207 377 5445
🌐 primelandproperty.co.uk
