Buying your first home should feel exciting, not overwhelming. The First Homes Scheme was created to give first-time buyers a smoother, more accessible path to homeownership. Whether you’re struggling with deposit requirements or navigating complex mortgage rules, this scheme offers a supportive solution tailored for those taking their first step onto the property ladder.
Owning a home is a dream for many individuals and families. However, first-time buyers often face rising house prices and strict mortgage criteria. To assist, the government and housing authorities have introduced schemes supporting aspiring homeowners.
The First Homes Scheme is a notable initiative that helps first-time buyers realise their homeownership goals. This article highlights the scheme’s main features, benefits, and its influence on the UK housing market.
What Is the First Homes Scheme?
First Homes is a government-backed initiative created to make homeownership more accessible for first-time buyers in England. The scheme offers selected new-build homes at a discount of at least 30% off the market value, helping eligible buyers step onto the property ladder with reduced financial pressure.
This discount applies only to qualifying properties and is intended to remain with the home at each sale. In doing so, the First Homes Scheme ensures that future eligible buyers continue to benefit from the same percentage reduction, maintaining long-term affordability within local communities.
How Does the First Homes Scheme Work?
Under the scheme, homes are offered at a discount of at least 30% off their market value. The maximum purchase price (after the discount is applied) is:
- £250,000 across most of England
- £420,000 in Greater London
Please note that local authorities may set lower price caps depending on regional housing needs and affordability standards.
To qualify, prospective buyers must meet the First Homes eligibility criteria, which include being a first-time buyer, purchasing a main residence, and meeting income or occupation-based criteria. The local authority must approve each buyer before the purchase is completed. This ensures the scheme is reserved for those who truly need it.
For more help with mortgages designed for first-time buyers, visit our First-Time Buyer Mortgages page.
Keeping the Discount for Future Buyers
A key feature of the First Homes Scheme is that the original discount stays with the property. Every time the home is resold, the same percentage discount is applied to the new sale price. This means future buyers must also meet eligibility checks and be approved by the local authority before purchasing.
The result is a long-term, affordable housing solution that enables multiple generations of first-time buyers to access homeownership in their local area.
For details on how mortgage protection can support your first home, see our Life Cover and Mortgage Protection article.
Important Notes
The First Homes Scheme is subject to availability, eligibility, and local authority approval. Terms and conditions apply. Not all developers or lenders may participate. To check whether you qualify and explore available properties, “Find Mortgage Advisers” who understand the First Homes process and can guide you through your mortgage application.
Key Features of the First Homes Scheme
1. Discounted Purchase Price
Eligible buyers can benefit from at least a 30% discount on the property’s open-market value. In some areas, local authorities may increase the discount up to 50% depending on regional housing needs.
2. Full Property Ownership
You own 100% of the home, even though you purchased it at a reduced price. This allows you to build equity in the usual way as your mortgage is paid down and the property value changes over time.
3. Price Limits After Discount
After the discount is applied, the maximum purchase price must not exceed:
- £250,000 across most of England
- £420,000 in Greater London
Local councils can apply lower price caps to reflect local affordability.
4. Long-Term Affordability
The discount is legally attached to the property’s title, meaning it is preserved for future sales. When you sell the home, the same percentage discount applies for the next eligible buyer, keeping the property affordable in the long term.
5. Mortgage and Deposit Requirements
To use the scheme, you must take out a mortgage for at least 50% of the discounted price. Most buyers will need a minimum 5% deposit, depending on the lender’s criteria.
6. Primary Residence Only
The home must be your primary residence. Buy-to-let investors or those purchasing second homes are not eligible.
Why Work With Connect Mortgages?
We have extensive experience helping first-time buyers secure affordable, appropriate mortgage deals. Our access to exclusive products through established partnerships gives you a broader range of solutions than most high street lenders can offer.
Our advisers will ensure the mortgage you choose is suitable, sustainable, and tailored to your goals, not just for now, but for the long term.
If you’re a mortgage adviser interested in supporting clients through this scheme, you can “Join our Mortgage network” and access exclusive resources and lender relationships.
Thank you for reading our “First Homes Scheme | Support for First-Time Buyers” publication. Stay “Connect“-ed for more updates soon!
