The UK government is preparing to formally launch a new homeownership support programme aimed at helping first-time buyers get onto the property ladder, with confirmation expected in
next month’s Budget.
The proposed “Your First Home” scheme is designed to reduce the upfront cost of buying a newly built property while encouraging developers to increase housebuilding. The programme represents a return to the government-backed equity loan model previously used under the Help to Buy initiative.
Under the planned arrangement, eligible first-time buyers would be able to purchase a new-build home with a deposit of as little as 2.5% of the property's value. The government would provide an equity loan worth up to 20%, leaving buyers to finance the remaining 75% through a conventional mortgage.
The government-backed loan would be interest-free for the first five years. It would generally have to be repaid when the property is sold, within 25 years, or alongside repayment of the buyer's main mortgage, according to the government's outline of the policy.
Properties valued at up to £600,000 would be eligible, although the programme would also introduce household income limits and regional property-price ceilings. Officials say these restrictions are intended to direct assistance towards households that face the greatest barriers to homeownership rather than providing a universal subsidy.
The initiative is also expected to involve financial contributions from participating housebuilders, with developers required to help meet some of the costs of operating the scheme.
Ministers are presenting the programme as part of a wider effort to tackle Britain's housing shortage while supporting economic growth. By strengthening demand among prospective buyers, the government hopes to give developers greater confidence to build more new homes.
The proposal revives elements of Help to Buy, which operated between 2013 and 2022 and helped more than 350,000 people purchase newly built homes. The earlier programme, however, attracted debate over its impact on house prices and the extent to which government assistance benefited buyers and developers.
Further details, including the final eligibility rules and funding arrangements, are expected to be confirmed when the government delivers its October Budget.
