Announced in the Budget on 28 October 2026, Your First Home will give eligible first-time buyers in England a 20% government equity loan on new-build homes, with a deposit from 2.5%. In London, prices are capped at £650,000 in inner London and £500,000 in outer London, and household income at £140,000. Pre-registration is due to open by the end of December 2026, with first loans from April 2027.
01How it works
- Deposit: at least 2.5% of the price, up to a maximum of 15%.
- Equity loan: 20% of the price from the government.
- Mortgage: a normal mortgage for the rest, from a participating lender.
- Interest: no interest on the equity loan for five years, then 1.5% in year six and 3% from year seven.
- Repayment: the loan must be repaid, usually when you sell or remortgage, and is normally linked to the property's value at that time.
02An example in outer London
| New-build flat | £500,000 |
|---|---|
| Your deposit (2.5%) | £12,500 |
| Government equity loan (20%) | £100,000 |
| Your mortgage (77.5%) | £387,500 |
| Stamp duty (first-time buyer) | £10,000 |
Without the scheme, the same flat with a 5% deposit would need a mortgage of £475,000. Borrowing £87,500 less makes a large difference to the income you need.
03Who is eligible
- First-time buyers in England buying a new-build home from a participating developer.
- Household income up to £140,000 in London and £110,000 elsewhere.
- The home must be under the local price cap.
- Home movers are not eligible.
Full details, including eligibility rules and loan terms, are still being finalised, so treat these points as subject to change.
04What to think about before you use it
- Because the loan is a share of the value, if the home rises in value, so does the amount you repay.
- The interest-free period ends after five years, so plan how you will reduce or repay the loan.
- New-build prices can carry a premium, and values can be slower to rise at first.
- Remortgaging with an equity loan in place has fewer lender options.
We are tracking the scheme as details are confirmed. If you are thinking about a new build in 2027, speak to us now and we will prepare your agreement in principle ahead of launch.
Frequently asked questions
When does Your First Home open?
Pre-registration is expected by the end of December 2026, full applications from February 2027 and the first loans from April 2027.
Is Your First Home the same as Help to Buy?
It is similar in principle, an equity loan on new builds, but with a smaller loan of 20%, a deposit from 2.5% and its own income and price caps.
What is the price cap in London?
Announced caps are £650,000 in inner London and £500,000 in outer London, set by local authority.
Can I use a Lifetime ISA with the scheme?
A Lifetime ISA can normally be used for a first home up to £450,000. Check the final rules once they are published.