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First Homes scheme

Buying a home can be challenging, especially for first-time buyers. With the government’s First Homes scheme, you can save up to 50% on new-build homes.

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What is the First Homes scheme?

The First Home scheme is a government incentive aimed at helping first-time buyers and key workers get onto the property ladder. It offers a discount typically around 30%, however in some cases up to 50% of the on the market price of a new-build property, making it more affordable for those just starting out.

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Who is eligible for the First Homes scheme?

The First Home scheme is available to first-time buyers in England only who meet certain criteria. To be eligible, you must:

  • Be at least 18 years old
  • A first-time buyer
  • Be able to get a mortgage for at least half the price of the home
  • Have a combined household income of less than £80,000 per year (or £90,000 if you live in London)
  • The new-build property market price must not exceed £250,000 (or £420,000 if you live in London)

Some councils may also set some additional eligibility conditions, including prioritising giving First Home scheme discounts to:

  • Essential workers – NHS employees, retail workers, police, firefighters and delivery drivers, will be prioritised
  • People who already live in the area
  • Members of the armed forces, as well as divorced, separated, or widowed spouses, and veterans who apply within five years of their service ending
  • Those on lower incomes

How does the First Homes scheme work?

Under the First Home scheme, eligible first-time buyers can apply for a discount of at least 30% off the market price of a new-build property. The discount is funded by the government and the property developer.

For example, if the property had a full market value of £250,000, you could buy the property with a 30% discount of £75,000, meaning the property would cost you £175,000. This significant discount would allow you to make a much smaller deposit and reduce your mortgage payments.

It’s important to note that the discount you receive must be passed on to the next buyer who is also a key worker or local first-time buyer when you sell the property. For example, if the property’s value were to increase by 10% over ten years to £275,000, you would receive £134,750 from the sale, and the next buyer would receive the same 30% discount.

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What deposit will I need for the First Homes scheme?

To purchase a First Homes property, a minimum 5% deposit is typically required. For example, if the property costs £200,000, the deposit would be £10,000.

To finance the property, a First Homes mortgage is required for homes acquired through the scheme. Various national and regional lenders, such as Nationwide and Halifax, have agreed to offer 95% mortgages on First Homes properties.

If you’re seeking more information about a First Homes mortgage, it may be beneficial to speak with a mortgage broker who can help you explore the current deals available.


First Homes scheme locations

The First Homes scheme began in 2021 with the first properties being made available in Bolsover, Derbyshire. Since then, the scheme has expanded and is now available in various locations throughout the country.

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How to apply for a First Homes scheme property

To purchase a First Homes property, reach out to the developer (or estate agent if you’re buying from a previous First Homes buyer) and express your interest. They will assist you in completing the application, which will then be forwarded to the local council.

If the First Home you wish to purchase is a new build, you will be required to pay a fee determined by the developer. If your application is denied, you will receive a refund of the fee.

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Selling or renting a First Homes scheme property

If you decide to sell your First Home, you can only sell it to someone who is eligible to buy a First Home, and you must offer them the same percentage discount based on the property’s market value at the time of sale. To sell, you will need to have the property valued by a surveyor who is registered with the Royal Institution of Chartered Surveyors (RICS).

If you wish to let your First Home, you are usually allowed to do so for a total of two years while you own the property, regardless of the number of tenants you have. Before letting, you need to check if your mortgage agreement permits it and inform the local council. However, if you sell the property to someone else, the two-year limit resets.

If you need to let the property for longer than two years, you may be able to do so under certain circumstances however it’s best to contact the local council and possibly your mortgage lender to look into the options.

What are the pros and cons of the First Homes scheme?


  • Offers a chance to step onto the property ladder without the need for a large deposit
  • Affordable property prices make it easier to secure a financially beneficial mortgage
  • Enables locals to purchase a property and stay within their community
  • Provides full ownership of the property


  • Selling the property in the future may not yield a significant profit as the discount must be passed on to the next eligible buyer
  • Lack of a centralised website makes it difficult to find and keep track of First Homes available to purchase, meaning taking part in the scheme involves more research
  • Limited number of properties currently available as the scheme is still new
  • Eligibility criteria for the scheme is more stringent than previous initiatives
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Will the First Homes scheme replace Help to Buy?

The First Homes Scheme will not replace the Help to Buy scheme. The Help to Buy scheme ended in March 2023 and the First Homes Scheme launched in June 2021 as a separate initiative to provide affordable homes to first-time buyers and key workers.

Due to the rising difficulty of getting a foot on the property ladder, shared ownership is continuing to gain popularity amongst first-time buyers. Under shared ownership you can buy a share of a property – between 25% and 75%, from a housing association. You then pay the housing association an ‘affordable rent’, which is significantly less than commercial rent. More young people are finding that shared ownership is the right solution for them. Find out more in our guide to shared ownership.

First Homes scheme vs Help to Buy schemeHere are the key differences between the First Homes scheme and the Help to Buy scheme which ended in March 2023.
 First Homes schemeHelp to Buy (equity loans)
Incentive type30-50% discount which has to be repaid at a later date (property has to be sold later at the same discount)A five-year interest free equity loan to boost your deposit value (has to be repaid at a later date)
Eligibility criteriaMaximum combined household income of less than £90,000 in London (or £80,000 for the rest of England)No earnings eligibility cap
Minimum deposit5%5%
Maximum property priceLondon £420,000. Rest of England after discount is applied: £250,000London £600,000. South East £437,600. North East £186,100
Ownership typeFull ownership (at a permanent discount from open market value)Full ownership. Government had an equity share of up to 20% (up to 40% in London), until the equity loan is repaid
Market restrictionsIncentives to local authorities making First Homes only available to buyers in their local areaOnly available through Help to Buy registered homebuilders, but property can be bought in any area of England
Buyer restrictionsMust be buyers’ only home and a mortgage covering at least 50% of purchase value is requiredMust be buyers’ only home and a minimum of 5% deposit, with a mortgage covering at least 75% of purchase value, is required
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Next steps

If you believe you are eligible and meet the requirements for the First Homes scheme, the first step is to conduct research on the builders and developments that are providing First Homes. Once you’ve identified available homes, you’ll have to get in touch with the builder directly to verify whether you meet the scheme’s local and national eligibility criteria.

Frequently Asked Questions