Your First Home: What the New First Time Buyer Scheme Means for You

Your First Home: What the New First Time Buyer Scheme Means for You

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Your First Home: What the New First Time Buyer Scheme Means for You

A 2.5% deposit, a 20% government loan and a mortgage for the rest: the Your First Home scheme, confirmed in the Autumn Budget on 28 October 2026, is the biggest new help for first time buyers since Help to Buy closed.

For years, the hardest part of buying a first home in London and the South East has been the deposit, not the monthly payment. The scheme is aimed at buyers without family money to lean on. So what is on offer, and who benefits?

How it works

A buyer puts down a deposit of between 2.5% and 15%, the government lends a further 20% as an equity loan, and a mortgage covers the rest. The loan stays at 20% everywhere, including London, where Help to Buy allowed up to 40%. The scheme is open to first time buyers in England and covers new build homes from developers signed up to it.

Household income must be below £110,000 (£140,000 in London). Price caps of the home follow local authority median prices, with ceilings of £650,000 in inner London and £500,000 in outer London.

The 20% loan from the government is interest free for five years, then charged at 1.5% in year six and 3% from year seven. It is repaid as 20% of the sale price, so if you buy at £200,000 with a £40,000 loan and sell at £220,000, you repay £44,000.

The first loans will be issued from April 2027.

What it means for buyers in London

The scheme cuts both the cash needed up front and the size of the mortgage. On a £450,000 new build in outer London, a conventional 5% deposit means putting down £22,500 and borrowing £427,500. Under Your First Home, the buyer puts down £11,250, receives a £90,000 equity loan and needs a mortgage of £348,750. That is £11,250 less to save and £78,750 less to borrow.

The catches

It covers new builds only, so it cannot be used for second hand homes. Because the loan is repaid as a share of the sale price, what you owe grows if your home gains value, and you should plan how to remortgage or repay before charges begin in year six.

Some critics of the old Help to Buy scheme argue that schemes like this push up new build prices. The government’s own evaluation of Help to Buy estimated a 5.5% premium on new builds, with a further 0.9% on homes bought through the scheme. Funding is also capped each year, so demand could outrun supply.

On the plus side, you can put down up to 15% to shrink your mortgage further, and the interest free years give breathing space early on.

The bottom line

Your First Home will not solve the affordability problem on its own, but for the right buyer it makes a real difference. If you want a new build and your target home sits within the price cap, the scheme can cut the deposit you need and the mortgage you take on by thousands of pounds. The key is to go in with your eyes open, check your local cap and work out how you will handle the loan once charges start.

At Tremula Property, many of our schemes are designed with first time buyers in mind, and there’s nothing we enjoy more than seeing people move into their first home. Our current schemes One Pitshanger Lane and Moxon House include apartments priced well within the London caps of £500,00, so they are well placed to qualify for Your First Home. Keep an eye out for launch dates and get in touch if you’d like to hear first.