First-Time Buyer Schemes & Government Help

First-Time Buyer Definition

For government scheme purposes, you're a first-time buyer if you've never owned a property, even if you've lived abroad or inherited land. Once you complete your first purchase, you're no longer eligible for first-time buyer schemes.

Important: Most schemes have property price caps. Check current limits as they change annually. In 2026, many schemes cap at £500,000–£600,000 depending on region.

Stamp Duty Relief for First-Time Buyers

The most valuable first-time buyer benefit is stamp duty relief. As of 2026, you pay no Stamp Duty Land Tax (SDLT) on properties up to £425,000. Above that, you pay standard rates.

Example: No Stamp Duty

Buy a £400,000 property as a first-timer: £0 stamp duty. Same property as a second buyer: £6,250 stamp duty. The relief saves you thousands.

Up to £425,000: 0% (first-time buyers only)
£425,001–£625,000: 5% on amount above £425,000
£625,001–£1,250,000: 10% on amount above £625,000
Above £1,250,000: 12% on amount above £1,250,000

Maximize This Benefit: If you're close to the £425,000 threshold, staying under it saves you 5% of the amount above. On a £450,000 purchase, you'd pay £1,250 instead of £0—not huge, but worth considering.

Shared Ownership

Shared ownership allows you to buy a percentage of a property (typically 25–75%) and pay rent on the portion you don't own. This lowers the deposit and borrowing requirements.

How It Works

Buy 50% of a £300,000 property: You need a £15,000 deposit (5% of £300,000) and borrow £135,000 as mortgage. You pay rent on the other 50%. The housing association owns the remaining share.

Staircasing

Shared ownership allows "staircasing"—gradually buying more shares until you own 100%. Each time you buy more shares, your rent decreases and your mortgage increases.

Advantages: Lower deposit; lower upfront borrowing; housing association support. Disadvantages: Ongoing rent; restrictions on changes; eventual staircasing needed for full ownership; limited resale options.

Help to Buy / Right to Buy Schemes

Several government programs support first-time buyers:

Right to Buy

If you're a council or housing association tenant (3+ years), you can buy your home at a discount (up to 35% in London, up to 50% elsewhere). This provides immediate equity and moves you to ownership.

New Build Support

Some developers and schemes offer first-time buyer discounts or deposit assistance on new build properties. Check with developers directly.

Regional Help to Buy schemes (varies by area—check your local council)
Lifetime ISA (save up to £4,000/year, get 25% government bonus up to £1,000/year for first-time buyers under 40)
Housing association shared ownership programs
Employer mortgage schemes (some employers offer mortgage discounts or deposit assistance)

Lifetime ISA (LISA)

A Lifetime ISA is a tax-free savings account for first-time buyers under 40. The government adds 25% to your savings (up to £1,000/year bonus on £4,000 contribution).

How It Works

Save £4,000/year for 5 years = £20,000. Government adds £5,000 (25% bonus). Total: £25,000 toward your deposit.

Requirements: Must be under 40 to open; home must be under £450,000; used within 10 years of opening or face 25% penalty on withdrawals. Start early to maximize the bonus.

Council or Local Authority Programs

Many local councils offer first-time buyer schemes:

Deposit assistance programs (council grants or low-interest loans for deposits)
Affordable housing schemes (buying at below market price in designated areas)
First-time buyer mortgage support (council-backed mortgages for eligible buyers)
Community land trusts (own the property but not the land, reducing purchase price)

Check Your Local Council: Search "[Your Council] first-time buyer schemes" or contact your local housing department. Schemes vary significantly by region—your area may have generous support.

Gifted Deposits from Family

If family members gift you deposit money, lenders accept it, but you'll need documentation:

Signed gift letter stating it's a gift, not a loan
Proof the money came from the gifter's account (bank statements)
Confirmation repayment isn't expected

Strategy: If parents gift 5–10%, you can use Lifetime ISA for additional boost. Combine these resources to reach 15%+ deposit more quickly.

Mortgage Broker Support

A mortgage broker can connect you with lenders offering first-time buyer programs, including:

Fee-free mortgages for first-time buyers
Reduced rates for time-limited periods
Lenders with lower minimum deposit requirements (5% vs. standard 10%)
Specialist lenders for unique circumstances

Why Use a Broker

Brokers access lenders you can't approach directly and negotiate based on volume. Their service is usually free—they're paid by the lender.

First-Time Buyer Checklist

Before you apply:

Check you're eligible for stamp duty relief (under £425,000 price cap)
Investigate Lifetime ISA if under 40
Ask family about deposit gifts or co-borrowing
Research local council schemes
Explore shared ownership if deposit is tight
Speak with a mortgage broker about first-time buyer products
Calculate total cost (purchase price + surveys, legal fees, stamp duty, insurance)

First-Time Buyer Schemes & Help