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The proposed scheme would offer first-time buyers of newly built homes in England an equity loan worth 20% of the property’s value.
What has changed? · 28/09/2026, 05:56 UTC
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The government has announced a ‘Your First Home’ scheme intended to help first-time buyers in England purchase with a small deposit. Its eligibility rules and launch date remain unclear. [1]
The deposit is only part of the upfront cost. Moneyfacts estimates that a 5% deposit on the average UK home price of £272,000, plus moving costs and legal fees, would total about £16,850. That is an illustration, not a fixed amount every first-time buyer needs. [1]
Anna Bowes of financial advisers The Private Office suggests moving an affordable sum into a regular savings account just after payday. Some accounts paying the highest rates require savers to hold a current account with the same provider. [1]
A Lifetime ISA allows savings of up to £4,000 a year, with a 25% government bonus worth up to £1,000 on a full annual contribution. It can be used towards a first home costing no more than £450,000. Withdrawals for other purposes before age 60 generally incur a penalty, apart from specified terminal-illness circumstances. Ministers plan to replace the account with a First Time Buyer ISA, but its design remains unclear. [1]
David Hollingworth of mortgage broker L&C points to loans with deposits starting at £5,000 and borrowing of up to 98% or 99% of the purchase price. Such deals may not suit every buyer, and not everyone will qualify. [1]
Prime Minister Andy Burnham has announced plans for Your First Home, a scheme under which first-time buyers in England could purchase a newly built home with a 2.5% deposit and an equity loan worth 20% of the property’s value. The scheme has not yet opened. [2]
Burnham said it was intended to help people who cannot rely on financial support from their parents. He also said he believed it would encourage developers to build more homes. Labour said the loan would be interest-free for an initial period, but has not specified how long that period would last. Ministers have not confirmed whether buyers would face an age limit or a cap on property prices.
The proposal comes amid a decline in housebuilding. Housing Secretary Angela Rayner said earlier in September that there was only a “slim chance” of meeting the government’s target of building 1.5 million homes in England by the next election. BBC Verify found that construction fell during Labour’s first year in power, continuing a decline that began under the Conservatives. [2]
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Further details are expected in October’s Budget, with pre-registration expected to open before the end of 2026. Funding is expected to come from existing budgets, while developers would contribute to running costs. [2]