New government scheme · Updated 28 September 2026
Your First Home scheme
A new scheme expected to help first-time buyers into a new build home with a 2.5% deposit and a 20% government equity loan. The full rules arrive at the Budget on 28 October.
- Find out what you could borrow now, before the scheme opens
- Hear from us as soon as the Budget confirms the rules
- Fee-free, whole-of-market advice from our new build team
Pre-registration is expected to open by the end of 2026. Talk to an adviser now and be ready when it does.
Your First Home at a glance
| Deposit | 2.5% minimum |
|---|---|
| Government equity loan | 20%, interest-free to start |
| Mortgage | 77.5% from a lender |
| Who can use it | First-time buyers only |
| Where | England, participating new build developments |
| Price and income caps | Yes, levels to be announcedDue at Budget |
| Full details | Autumn Budget, |
| Pre-registration | Expected by the end of 2026Reported |
Based on the government announcement of 26 September 2026. Details may change when the scheme rules are published.
Your First Home scheme: the new Help to Buy, explained
Your First Home is a new government scheme that’s expected to let first-time buyers in England buy a new build home with a 2.5% deposit, backed by a 20% government equity loan with an initial interest-free period. It was announced on 26 September 2026, and the full rules, including income and price caps, will be confirmed at the Budget on 28 October 2026.
If you’ve been searching for “the new Help to Buy”, this is it. Same equity loan model, half the deposit, and some new limits on who can use it. We’re updating this page as each detail is confirmed.
Reviewed by Kane Powell, Senior Mortgage Adviser. Last updated 28 September 2026.
Your First Home: latest updates
- Reaction
Housebuilders welcome the scheme, some agents urge caution. Major housebuilders have called for a fast launch, while property commentators warn new build prices could rise if demand is funnelled into one part of the market.
- Reported
Pre-registration expected by the end of 2026. Media reports say buyers will be able to pre-register before the end of the year, and that participating developers will pay a fee linked to property values. Not yet on GOV.UK.
- Confirmed
Government announces Your First Home. A 2.5% deposit and 20% equity loan scheme for first-time buyers of new build homes in England, with income and local price caps to be set out by the Chancellor at the Budget.
What we know about Your First Home so far
The government has announced the shape of the scheme, but not the fine print. Here’s every detail so far, labelled by how solid it is.
Your First Home: what's confirmed and what isn't
| Scheme detail | What we know | Status |
|---|---|---|
| Minimum deposit | 2.5% of the purchase price | Announced |
| Government equity loan | 20% of the purchase price | Announced |
| Who can use it | First-time buyers in England | Announced |
| Eligible homes | New builds from developers signed up to the scheme | Announced |
| Interest-free period | Yes, for an initial period | Announced |
| Length of interest-free period | Five years | Reported |
| Maximum property price | Local price caps, up to £600,000 | Reported |
| Household income cap | Yes, level not yet published | Due at Budget |
| Developer contribution | Fee linked to property values | Reported |
| Pre-registration | By the end of 2026 | Reported |
| Fees after the interest-free period | Not yet published | Due at Budget |
| Launch date and how to apply | Not yet published | Due at Budget |
Sources: GOV.UK press release (MHCLG), 26 September 2026; PA Media and Reuters reporting, 26 September 2026. Last checked 28 September 2026.
How does the Your First Home scheme work?
Your purchase is funded in three parts:
- Your deposit: at least 2.5% of the price
- A government equity loan: 20% of the price, interest-free for an initial period
- Your mortgage: the remaining 77.5%, from a lender
Because a lender only needs to cover 77.5% of the price, you borrow less than you would on a standard 95% mortgage. That’s why the government says buyers could save hundreds of pounds a month compared with a 95% mortgage.
The equity loan is linked to your home’s value, not a fixed sum. Under Help to Buy, if you borrowed 20%, you repaid 20% of what the home was worth when you repaid. On a £250,000 home that’s a £50,000 loan. If the home is worth £280,000 when you repay, you’d pay back £56,000. If it’s worth £230,000, you’d pay back £46,000. We expect Your First Home to work the same way, but the government hasn’t confirmed it yet.
How a Your First Home purchase could be funded
| For a £250,000 new build | Your First Home | Standard 95% mortgage |
|---|---|---|
| Deposit you need | £6,250 | £12,500 |
| Government equity loan | £50,000 | None |
| Mortgage from a lender | £193,750 | £237,500 |
| Household income typically needed (at 4.5x) | £43,056 | £52,778 |
You'd borrow £43,750 less from a lender and need £6,250 less in deposit than with a 95% mortgage.
Illustrative only, not a quote or a recommendation. Based on the announced 2.5% deposit and 20% equity loan; final scheme rules, price caps and income caps are due at the Budget on 28 October 2026. The 4.5x income multiple is a common lender maximum, not a guarantee: lenders assess affordability individually. Excludes stamp duty, fees and moving costs. Your home may be repossessed if you do not keep up repayments on your mortgage.
When does Your First Home start?
There’s no launch date yet. The Budget on 28 October will set out costs and timings, and pre-registration is reported to open before the end of 2026. After that, the scheme needs developers to sign up and lenders to launch mortgages built around the equity loan, so expect a gap between the rules being published and the first buyers completing.
Your First Home: key dates
- Scheme announced
Headline terms published by government.
- Budget
Income cap, price caps, costs and timings confirmed.
- By end of 2026Pre-registration
Reported to open before the year ends.
- To be confirmedFirst purchases
Depends on developer sign-up and lender products.
Who can use Your First Home?
Based on what’s been announced, you’ll need to be:
- a first-time buyer
- buying in England
- buying a new build from a developer signed up to the scheme
- under a household income cap (level due at the Budget)
- buying below a local price cap (levels due at the Budget)
You’ll also need to pass a lender’s normal affordability and credit checks. If you’re buying with someone else, expect both of you to need to be first-time buyers, as was the case under Help to Buy. The old scheme also required a repayment mortgage and couldn’t be used for a second home or buy-to-let. Similar conditions are likely.
How much can you spend? Your First Home price caps
Price caps will be set locally, with the maximum reported at £600,000. The government hasn’t said whether it will reuse the Help to Buy limits, but they’re the clearest guide to how regional caps have worked before.
Help to Buy price caps by region (2021 to 2023)
The last Help to Buy scheme set a different maximum price for each region. Your First Home will also use local price caps, reported to top out at £600,000. These are the previous limits, for reference.
| Region | Help to Buy cap | Relative size |
|---|---|---|
| London | £600,000 | |
| South East | £437,600 | |
| East of England | £407,400 | |
| South West | £349,000 | |
| East Midlands | £261,900 | |
| West Midlands | £255,600 | |
| Yorkshire and the Humber | £228,100 | |
| North West | £224,400 | |
| North East | £186,100 |
Help to Buy: Equity Loan (2021 to 2023) regional price caps. Your First Home local caps have not been published and may differ. We'll add them here once confirmed at the Budget.
For context, 30% of Help to Buy purchases were homes worth £200,000 or less. These schemes are mostly used for first homes at the more affordable end of the market.
Your First Home vs Help to Buy: what’s changed?
Help to Buy vs Your First Home
| Help to Buy 2013 to 2021 | Help to Buy 2021 to 2023 | Your First Home 2026 | |
|---|---|---|---|
| Minimum deposit | 5% | 5% | 2.5% |
| Equity loan | Up to 20%, 40% in London | Up to 20%, 40% in London | 20% London not stated |
| Who could use it | First-time buyers and home movers | First-time buyers only | First-time buyers only |
| Property | New build only | New build only | New build, participating developers |
| Price cap | £600,000 across England | Regional, £186,100 to £600,000 | Local caps Up to £600,000 reported |
| Income cap | None | None | Yes Level due at Budget |
| Interest-free period | 5 years | 5 years | Yes 5 years reported |
| After interest-free period | 1.75% fee, rising yearly by RPI + 1% | 1.75% fee, rising yearly by CPI + 2% | Due at Budget |
| Repayment | Same % of home's value | Same % of home's value | Expected to be similar |
| Developer contribution | None | None | Yes, fee linked to property values |
Help to Buy details from GOV.UK. Your First Home details from the GOV.UK announcement of 26 September 2026 and media reporting. Labels show which details are still unconfirmed.
Three changes matter most:
- Half the deposit. 2.5% instead of 5%. On a £250,000 home, that’s £6,250 instead of £12,500.
- A household income cap. Help to Buy had none. This scheme is aimed at buyers who couldn’t get on the ladder without it.
- Developers pay to take part. This may affect which developers sign up and which homes are available.
What stays the same: new build only, a 20% equity loan that tracks your home’s value, and an interest-free start.
Buying in London? Help to Buy offered up to 40% in London. So far, Your First Home only mentions 20%. On a £600,000 home, that leaves a £465,000 mortgage to fund, which needs a high income and may sit awkwardly alongside an income cap. The Budget will show whether London gets different terms.
What happens when the interest-free period ends?
The government hasn’t confirmed this yet. Under the last Help to Buy scheme, you paid a fee of 1.75% of the loan in year six, rising each April by CPI plus 2%. On a £50,000 loan, that’s around £875 a year, or about £73 a month, in year six.
Under Help to Buy you could repay the loan:
- in full when you sell
- in full when you remortgage
- in part, in chunks of at least 10% of your home’s value
- at the end of your mortgage term
Many Help to Buy buyers planned a remortgage around the end of the interest-free period to clear or reduce the loan. It’s worth building that plan in from day one.
Is Your First Home a good idea?
It can be, for the right buyer. The upsides are clear: you can buy years earlier with a smaller deposit, borrow less from a lender, and pay nothing on the equity loan for the first few years.
There are trade-offs too. You’ll have two debts secured on your home. If prices rise, the loan grows with them. You’re limited to participating developers, and research on Help to Buy found scheme buyers paid more for new builds than those who didn’t use it. Comparing prices with similar homes outside the scheme is worth doing before you reserve.
What the industry is saying
Barratt Redrow's chief executive Dean Banks said it is "vital that Your First Home is introduced as soon as possible", arguing a well-designed scheme gives housebuilders confidence to build more homes.
Property Week, September 2026
Research by reallymoving in 2019 found first-time buyers using Help to Buy paid 10.3% more for new builds than buyers of new homes who didn't use the scheme.
reallymoving research, cited by Property Industry Eye, September 2026
Analysts expect the real test over the next 6 to 12 months to be how many developers sign up and how many lenders launch mortgages designed around the 20% equity loan.
PropertyNews, September 2026
Your First Home vs other ways to buy with a small deposit
Your First Home won’t suit everyone. If you want an older home, earn above the income cap, or would rather own outright from day one, another route may work better.
Your First Home vs other ways to buy with a small deposit
| Your First Home | 95% mortgage | Shared Ownership | |
|---|---|---|---|
| Minimum deposit | 2.5% of the price | 5% of the price | Typically 5% of the share you buy |
| What you own | 100%, with a 20% government loan secured on it | 100% | A share, from 10%, paying rent on the rest |
| Property type | New build from participating developers | Any, subject to lender | Mostly new build, through housing providers |
| First-time buyers only | Yes | No | No, with some exceptions |
| Income cap | Yes, level due at Budget | No, lender affordability applies | £80,000, or £90,000 in London |
| Monthly costs | Mortgage, plus loan fees after the interest-free period | Mortgage | Mortgage, rent and service charge |
General comparison only. The right route depends on your income, deposit, location and plans. Your home may be repossessed if you do not keep up repayments on your mortgage.
Costs a 2.5% deposit won’t cover
- Stamp duty: under current rules, first-time buyers pay none up to £300,000 and 5% on the portion between £300,001 and £500,000. Above £500,000 the relief doesn’t apply. A £350,000 home means £2,500 in stamp duty.
- Reservation fee: most developers charge one to take a plot off the market.
- Legal fees: you’ll need a solicitor who can handle the equity loan paperwork as well as the purchase.
- Surveys and snagging: an independent snagging inspection is worth considering on a new build.
- Moving and furnishing: new builds often come without carpets or curtains.
How to get ready before the scheme opens
The buyers who move fastest when pre-registration opens will be the ones who’ve done the groundwork already.
Get ready for Your First Home: 6 things to do now
- Check your credit file
Get free reports from the main credit reference agencies and fix any errors now. Disputes can take weeks.
- Work out your full upfront costs
Budget for the 2.5% deposit plus the reservation fee, legal fees, any stamp duty, surveys and moving costs.
- Find out what you could borrow today
A fee-free adviser can show how much a lender would offer you on 77.5% of a home's price.
- Gather your documents
Photo ID, three months of payslips and bank statements, and your latest P60. Self-employed? Two years of SA302s and tax year overviews.
- Know your household income
Add up gross income for everyone buying, so you can check it against the income cap the moment it's published.
- Get on the update list
Pre-registration is reported to open by the end of 2026. Be ready to act as soon as it does.
Why first-time buyers choose Heron Financial for new build
- Fee-free and whole of market. We compare mortgages across the market and don’t charge you for advice.
- New build experience. We work with housebuilders including Berkeley Group, with dedicated contacts and regular site visits, so we know how developer timescales and reservation deadlines work.
- Help to Buy experience. We supported buyers through the previous Help to Buy scheme and understand how lenders assess equity loan purchases.
- Open seven days a week. With our Everglades digital application, you can upload documents and track progress when it suits you.
- B Corp certified and rated Excellent on Trustpilot from over 2,300 reviews.
Get ready for Your First Home
Book a free call and we’ll show you what you could borrow today, and what the scheme could add once the rules are confirmed.
See why homebuyers rate us 5 stars, your mortgage made easy.
Frequently Asked Questions
What is the Your First Home scheme?
Your First Home is a government equity loan scheme for first-time buyers in England, announced on 26 September 2026. It’s expected to let you buy a new build home with a 2.5% deposit, with the government lending 20% of the price and your mortgage covering the rest. The full rules will be confirmed at the Budget on 28 October 2026.
Is Your First Home the new Help to Buy?
Yes, in effect. It uses the same equity loan model as the Help to Buy scheme that closed in 2023: new build homes only, a 20% government loan and an initial interest-free period. The main differences announced so far are a lower 2.5% minimum deposit, a household income cap and a contribution from participating developers.
When does the Your First Home scheme start?
No launch date has been set yet. The government will publish costs and timelines at the Budget on 28 October 2026, and pre-registration is reported to open by the end of 2026. You can’t apply today, but you can get your finances and paperwork ready now.
Can I use Your First Home to buy an older home?
No, based on what’s been announced. The scheme is for new build homes bought from developers who sign up to it. If you want a resale property, a 95% mortgage or another route may suit you better.
Can I use a Lifetime ISA with Your First Home?
This hasn’t been confirmed yet. Lifetime ISA savings could be used alongside the old Help to Buy equity loan, but a Lifetime ISA can only be used on a home costing £450,000 or less, which is below the reported £600,000 upper price cap for this scheme. We’ll update this answer once the rules are published.
Can Heron Financial help me get a mortgage with Your First Home?
Yes. Heron Financial is a fee-free, whole-of-market mortgage broker that works with housebuilders on new build sales and supported buyers through the previous Help to Buy scheme. Once lenders launch Your First Home mortgages, our advisers can compare them for you and handle the application from reservation to completion. Until then, we can tell you what you could borrow today.
Does Heron Financial charge a fee for new build mortgage advice?
No. Heron Financial’s mortgage advice is fee-free, including for new build purchases and government schemes. We receive commission from the lender when your mortgage completes, so there’s nothing to pay us directly.
Sources: GOV.UK (MHCLG) press release, 26 September 2026; GOV.UK Help to Buy equity loan statistics; PA Media, Reuters, Property Week, Property Industry Eye and PropertyNews coverage, September 2026. Details marked “reported” come from media coverage and haven’t been confirmed by government. Last updated 28 September 2026. Reviewed by Kane Powell, Senior Mortgage Adviser.
Your home may be repossessed if you do not keep up repayments on your mortgage.