Your First Home at a glance
- For first-time buyers only, buying a home to live in as their main residence
- For new-build homes in England from a developer signed up to the scheme
- The home must be priced at or below the local price cap, from £215,000 up to £650,000 depending on the area
- You need a repayment mortgage from a participating lender, with normal affordability and credit checks
- No maximum age limit has been set
- £4.7 billion of funding, expected to help around 70,000 households
What is the Your First Home scheme?
Your First Home is a government equity loan scheme from the Ministry of Housing, Communities and Local Government. It is aimed at first-time buyers who could afford mortgage repayments but would struggle to buy without help, usually because saving a large deposit is so hard.
You put down a deposit of at least 2.5%. The government lends you 20% of the price through an equity loan, and a mortgage from a participating lender covers the rest. With the minimum deposit, your mortgage would be 77.5% of the price instead of the 95% you would need with a standard 5% deposit mortgage.
You own the home outright from completion. The government is not a joint owner or your landlord; it simply has a loan secured against the property.
What is an equity loan?
An equity loan is a loan for a percentage of your home's value, not a fixed sum. When you sell, or choose to pay it back, you repay that same percentage of what the home is worth at the time, based on an independent valuation.
The government's own example: a £60,000 loan on a £300,000 home is 20%. If the home is later worth £320,000, you would repay £64,000. If it falls to £280,000, you would repay £56,000.
Who is eligible?
To use Your First Home you will normally need to:
- Be a first-time buyer
- Be buying a new-build home in England from a participating developer
- Live in the home as your main residence (it cannot be let out)
- Have a total household income of £110,000 or less outside London, or £140,000 or less in London
- Buy a home priced at or below the local price cap for that area
- Put down a deposit of at least 2.5% (reports from the Budget say the maximum deposit is 15%)
- Be able to get a repayment mortgage from a participating lender
The full eligibility rules, including the exact definition of a first-time buyer and how joint purchases will be treated, will be published before applications open in February 2027.
Price caps: Southampton, Hampshire and beyond
Each local authority area has its own price cap, based on local median house prices. The highest cap is £650,000 in 15 inner London boroughs and the lowest is £215,000 in North Lincolnshire. Here are the caps for our local area:
| Area (Hampshire, Dorset and Isle of Wight) | Price cap |
|---|---|
| Southampton | £245,000 |
| Eastleigh | £425,000 |
| Test Valley | £365,000 |
| New Forest | £330,000 |
| Winchester | £420,000 |
| Fareham | £415,000 |
| Portsmouth | £340,000 |
| Gosport | £225,000 |
| Havant | £380,000 |
| East Hampshire | £425,000 |
| Basingstoke and Deane | £425,000 |
| Hart | £445,000 |
| Rushmoor | £365,000 |
| Isle of Wight | £260,000 |
| Bournemouth, Christchurch and Poole | £315,000 |
| Other examples across England | Price cap |
|---|---|
| Inner London | £650,000 |
| Outer London | £500,000 |
| Reading | £375,000 |
| Manchester | £355,000 |
| Bristol | £325,000 |
| North Devon | £320,000 |
| Birmingham | £315,000 |
| Leeds | £305,000 |
| Middlesbrough | £220,000 |
| North Lincolnshire | £215,000 |
The cap is set by the area the home is in, not where you live now. If you live in Southampton but are open to buying in Eastleigh or Test Valley, for example, a much wider choice of new-build homes could fall within the scheme. Caps in most areas cover flats and smaller houses, while many larger family homes will sit above them.
Interest and costs on the equity loan
| Period | Interest on the equity loan | Example on a £60,000 loan |
|---|---|---|
| Years 1 to 5 | 0% | £0 |
| Year 6 | 1.5% | £75 a month |
| Year 7 onwards | 3% | £150 a month |
Interest is paid separately from your mortgage and does not reduce the amount you owe on the equity loan. The government has not yet confirmed how interest will be collected.
This is simpler than Help to Buy, where the fee started at 1.75% in year six and then rose every year with inflation. Even so, it is a real cost to plan for, and many buyers will look to remortgage and repay some or all of the equity loan before the interest kicks in.
Paying the loan back
You normally repay the equity loan when you sell. You can also repay part or all of it earlier, for example when you remortgage, and you repay the same percentage of the home's value at that time. Minimum repayment amounts, valuation rules and fees will be published before the scheme opens.
Key dates
The government announces Your First Home.
The Budget confirms the scheme, income caps, interest rates and timeline.
Local price caps published for every area in England.
Pre-registration opens for buyers, with full guidance. Developers begin signing up. Pre-registering does not commit you to buying.
Applications open.
The first homes are bought using the scheme.
What is confirmed and what is still to come
| Detail | What we know | Status |
|---|---|---|
| Who can use it | First-time buyers buying their main home | Confirmed |
| Where and what | New builds in England from participating developers | Confirmed |
| Deposit | At least 2.5% (reported maximum 15%) | Confirmed |
| Equity loan | 20% everywhere, including London | Confirmed |
| Interest | 0% for 5 years, 1.5% in year 6, 3% from year 7 | Confirmed |
| Household income cap | £110,000 (£140,000 in London) | Confirmed |
| Price caps | Set for each local authority, £215,000 to £650,000 | Confirmed |
| Age limit | No maximum age | Confirmed |
| Timeline | Pre-registration by end of Dec 2026, applications Feb 2027, first purchases Apr 2027 | Confirmed |
| Who runs it | Homes England at first, then the National Housing Bank | Confirmed |
| Participating lenders | List to be published before launch | TBC |
| Repayment details | Minimum repayments, valuations and fees | TBC |
| Joint purchases and first-time buyer definition | Full rules due before applications open | TBC |
| Lifetime ISA | Reported as usable with the scheme; not yet in official guidance | Reported |
| Combining with Shared Ownership or First Homes | Not yet stated | TBC |
Is Your First Home the same as Help to Buy?
It is very similar, and many people are calling it the new Help to Buy. The main differences are the lower deposit, the new income cap, a 20% loan in London rather than 40%, and simpler interest charges.
| Help to Buy: Equity Loan (2021 to 2023) | Your First Home | |
|---|---|---|
| Who | First-time buyers | First-time buyers |
| Property | New builds | New builds from participating developers |
| Minimum deposit | 5% | 2.5% |
| Equity loan | 20% (40% in London) | 20% everywhere |
| Income cap | None | £110,000 (£140,000 London) |
| Price cap | Regional caps (e.g. £437,600 in the South East) | Local authority caps (e.g. £245,000 in Southampton) |
| Interest-free period | 5 years | 5 years |
| Interest after | 1.75% in year 6, rising each year with inflation | 1.5% in year 6, then 3% |
How does it compare with other first-time buyer options?
| Option | Typical deposit | How it works | Available now? |
|---|---|---|---|
| Your First Home | 2.5% | 20% government equity loan, new builds only | From April 2027 |
| 95% mortgage (Mortgage Guarantee Scheme) | 5% | Government guarantee helps lenders offer 91% to 95% mortgages on new and older homes | Yes |
| First Homes | Usually 5% of the discounted price | New builds sold at a discount of at least 30% to eligible local buyers | Yes, limited supply |
| Shared Ownership | 5% to 10% of your share | Buy a share of the home and pay rent on the rest | Yes |
Despite the similar names, Your First Home and First Homes are two different schemes.
Things to think about before you use the scheme
You may repay more than you borrowed
Because you repay a share of your home's future value, a rise in value means a bigger repayment.
Interest from year six
On a £60,000 loan, you would pay £75 a month in year six and £150 a month after that, on top of your mortgage. Plan for this from day one.
New-build pricing
The government's own evaluation of Help to Buy found new builds sold for around 5.5% more than comparable older homes, with Help to Buy purchases carrying a further premium of just under 1%. Compare prices with similar homes nearby so you know you are paying a fair price.
Mortgage deals
You will need a participating lender. Under Help to Buy, equity loan mortgages were sometimes priced slightly higher than standard deals, so it pays to compare the whole market with a broker.
Your total borrowing
With the minimum deposit, your mortgage plus the equity loan add up to 97.5% of the price. This matters if you want to move or remortgage in the early years.
Selling later
The new-build premium can fade once a home becomes second-hand, and the next buyer will not be able to use Your First Home to buy it from you.
Should I wait for the scheme?
It depends. The first purchases are not expected until April 2027, the scheme only covers new builds within the price cap, and funding is capped each year. If you have found the right home now, buying with a 95% mortgage, a gifted deposit, a guarantor or Shared Ownership could still be the better route.
If Your First Home looks right for you, use the time now to get ready: check your credit file, keep saving, gather your payslips and bank statements, and speak to an adviser about what you could borrow. That way you can pre-register as soon as it opens and move quickly when applications start.
Frequently asked questions
Not yet. Pre-registration is due to open by the end of December 2026. Pre-registering will not commit you to buying through the scheme. Applications open in February 2027.
£245,000. Nearby areas have higher caps, including Eastleigh (£425,000), Test Valley (£365,000) and the New Forest (£330,000). The cap depends on where the home you are buying is located.
No. The scheme is for new-build homes only, from developers who have signed up. For older homes, a standard or 95% mortgage may be an option.
No maximum age limit has been set. You will still need to meet the lender's own criteria for the mortgage term.
No. Your First Home is for first-time buyers only. For schemes like this, you generally cannot count as a first-time buyer if you have ever owned a home anywhere in the world. Home movers looking for a smaller deposit can still use 95% mortgages through the Mortgage Guarantee Scheme.
No. The home must be your main residence.
No, Your First Home covers England only. In Wales, Help to Buy Wales has been extended until 31 March 2027, offering a 20% equity loan with a 5% deposit on new builds up to £300,000.
The Budget did not change stamp duty. In England, first-time buyers pay no stamp duty on the first £300,000 and 5% on the portion between £300,001 and £500,000. Under Help to Buy, stamp duty was based on the full purchase price, and the same is expected here. As most local price caps are under £300,000 or not far above it, many buyers will pay little or no stamp duty.
MoneySavingExpert reports that a Lifetime ISA can be used, as it could with Help to Buy, but this is not yet in the official guidance. Separately, the Budget cut the Lifetime ISA withdrawal charge to 20% for first homes costing over £450,000, and announced a new First Time Buyer ISA to replace the Lifetime ISA for new savers from April 2029.
This has not been confirmed. Help to Buy could not be combined with Shared Ownership, so a similar rule may apply.
No. Your existing loan stays on its original terms. As you already own a home, you would not be able to use Your First Home for your next purchase.
Thinking about Your First Home? Talk to us first
Our specialist new homes team helped first-time buyers through Help to Buy and works with housebuilders across the country seven days a week. We compare deals from over 90 lenders, so we can tell you whether Your First Home is the right route for you, which lenders are taking part, and how much you could borrow, or find another route that gets you moving sooner.
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