The government has announced a new equity loan scheme to help first-time buyers onto the property ladder.
It’s called Your First Home, and the pitch is simple: a small deposit, a government loan, and a mortgage for the rest.
Announced by the Prime Minister on 26 September 2026, ahead of the Labour conference, the scheme is expected to let eligible first-time buyers purchase a new-build home in England with a 2.5% deposit, alongside a 20% government equity loan, with an initial interest-free period.
One thing to be clear about before anything else: this has been announced, not launched.
The full detail is due at the Autumn Budget on 28 October 2026, and pre-registration is expected to open by the end of 2026. Nobody can apply yet, and several of the points that decide who actually benefits — the income cap, the price limits, the length of the interest-free period — have not been set.
This guide sets out what’s confirmed, how the numbers work, how it compares to the Help to Buy scheme it echoes, and what a would-be first-time buyer can sensibly do right now.
Lower than the 5% Help to Buy required, and well below what a standard 95% mortgage needs. The government says a lower deposit is the whole point — targeting buyers who can save a little but can’t call on family money.
The government lends 20% of the purchase price. You put in your 2.5% deposit and take a mortgage for the balance — around 77.5%.
The equity loan carries no interest for an opening period. Help to Buy’s equivalent was five years; the length for this scheme hasn’t been confirmed.
As with Help to Buy, the scheme applies to new-build homes from developers signed up to it — not the resale market.
Limited to England, and to genuine first-time buyers.
Both confirmed in principle. Neither figure has been published. The income cap is a departure from early Help to Buy, which had none until its final version.
The structure is a three-way split: your deposit, the government’s loan, and your mortgage.
Here’s how that looks on an illustrative £300,000 new-build. These figures are for illustration only — they are not scheme limits, and your local price cap may be lower.
| Component | Share | Amount |
|---|---|---|
| Your deposit | 2.5% | £7,500 |
| Government equity loan | 20% | £60,000 |
| Your mortgage | 77.5% | £232,500 |
| Purchase price | 100% | £300,000 |
The headline saving is the deposit. On this example, 2.5% is £7,500, against £15,000 for a 5% deposit or a far larger sum saved the conventional way.
But note the mortgage. You’re still borrowing 77.5% of the property’s value, and that’s the payment you meet every month. A smaller deposit means a larger mortgage — so the monthly cost, and what you can comfortably afford, matter more than clearing the deposit hurdle. Our how much you could borrow calculator is a sensible starting point.
The government has not yet confirmed the repayment terms. But the scheme is closely modelled on Help to Buy, so it’s reasonable to expect a similar structure — with the detail to follow at the Budget. Under Help to Buy, three things were true, and each is worth understanding in advance.
The equity loan was 20% of what the property was worth when you repaid it — not 20% of the original price. So if your home rose in value, the amount you owed rose with it. On the £300,000 example above, a £60,000 loan against a home that later sold for £360,000 would be repaid at £72,000. This is the single point buyers most often underestimated.
Once the opening interest-free years ended, a fee kicked in on the equity loan and rose over time — on top of your mortgage payment.
Buyers could pay down the loan (often in tranches), or clear it entirely when they sold or remortgaged. Whether Your First Home mirrors all of this will be confirmed on 28 October. Until then, treat the repayment terms as expected rather than fixed.
Until the Budget, building a firm plan around the scheme means building on figures that don’t exist yet.
The parallels are deliberate. Your First Home is broadly the Help to Buy equity loan model, which ran from 2013 and closed to new applications in 2023. Here’s how the two line up on what’s known so far.
| Feature | Help to Buy (2021–2023) | Your First Home (as announced) |
|---|---|---|
| Who | First-time buyers | First-time buyers |
| Deposit | 5% | 2.5% |
| Equity loan | 20% (40% in London) | 20% (London rate not confirmed) |
| Interest-free period | 5 years | Initial period, length not confirmed |
| Property | New-build, participating developers | New-build, participating developers |
| Region | England | England |
| Income cap | None | Yes — level not confirmed |
| Price caps | Regional | Local — not confirmed |
| Developer fee | No | Yes — indexed to property values |
| Status | Closed 2023 | Announced; opens by end 2026 |
The two visible improvements are the lower 2.5% deposit and the developer fee, which housebuilders will pay and which is meant to limit the new-build price inflation the earlier scheme was criticised for. The income cap is the notable tightening — it targets support but will exclude some buyers who’d have qualified under Help to Buy.
An honest look, because a scheme designed to help can still be the wrong choice for an individual.
You repay it — and if your home gains value, you repay more than you borrowed. That’s how the government shares in the upside of your property.
New-build homes typically cost more than comparable resale property, and a scheme that concentrates demand on participating developments can hold prices up. The developer fee is meant to counter this, but the price you pay is as important as the help you get.
Borrowing 77.5% on a 2.5% deposit leaves less equity cushion. If property values fall, you’re closer to negative equity than a larger-deposit buyer would be.
An income cap, local price caps and the new-build-only rule will each rule some buyers out.
Your First Home is one route — and it isn’t open yet. Several others are available today, and one of them may suit you better.
Which of these fits depends on your deposit, income, and how long you’re willing to wait. As a whole-of-market broker, we can assess your position across all of them, not just the scheme making headlines.
Register your interest when pre-registration opens. Expected by the end of 2026, and it commits you to nothing.
Don’t rush a decision before the Budget. The eligibility detail on 28 October decides whether the scheme fits you at all.
Get your position assessed against every option. The announced scheme isn't the only route onto the ladder, and for many buyers it won't be the best one.
A government equity loan scheme, announced on 26 September 2026, expected to help first-time buyers purchase a new-build home in England with a 2.5% deposit and a 20% government equity loan.
No. It’s been announced, not launched. Pre-registration is expected by the end of 2026, with full detail at the Budget on 28 October 2026. There’s no live application date yet.
The scheme is expected to require a 2.5% deposit — on a £300,000 home, that’s £7,500. This is subject to confirmation at the Budget.
20% of the purchase price. On a £300,000 home that’s £60,000, leaving a mortgage of around 77.5%.
There’s an initial interest-free period, but its length hasn’t been confirmed. Under Help to Buy it was five years, after which a fee applied and rose over time.
The terms aren’t confirmed. If the scheme follows Help to Buy, you’d repay 20% of the property’s value at the point you repay — so the sum can rise if your home gains value — with the option to repay in stages or in full when you sell or remortgage.
No. It applies to new-build homes from participating developers in England, for first-time buyers only.
It’s based on the same equity loan model, with a lower 2.5% deposit, a new income cap and a developer fee. The full detail comes at the Budget.
Several routes are open today — a 95% mortgage, the Mortgage Guarantee Scheme, shared ownership, or saving for a larger deposit. We can assess which suits you best.
Until then, the sensible move is to understand every route available to you, not just the one making headlines. We can assess your position across all of them.
