What is the First Homes Scheme?
The First Homes scheme is a UK government program that helps first-time buyers and key workers buy a new-build home at a 30% to 50% discount. The goal is to make buying a home more affordable for people who might otherwise struggle to get on the property ladder.
This scheme is available in England only, and the homes are always discounted, even when they are sold again in the future.
Who Counts as a First-Time Buyer?
You are a first-time buyer if:
- You have never owned a home in the UK or anywhere else.
- You have not inherited or been gifted a house or flat.
- You are buying a home for the first time in your name.
First-time buyers often qualify for stamp duty relief, and schemes like First Homes can make things even easier.
Who is Eligible for the First Homes Scheme?
To qualify for the First Homes scheme, you must:
- Be a first-time buyer
- Have a household income of:
- Less than £80,000 per year (outside London)
- Less than £90,000 per year (in London)
- Be buying a new-build home
- The home must cost:
- Under £250,000 (outside London)
- Under £420,000 (in London)
- Have a local connection or already live or work in the area
- Be a key worker (like a teacher, nurse, firefighter, supermarket staff, or Armed Forces member)
Each local council may adjust the list of key workers based on local needs.
How Does the First Homes Scheme Work?
Here’s how it works:
- Let’s say a new-build home has a market value of £200,000.
- With a 30% discount, the home would cost you £140,000.
- You need to get a mortgage on the discounted amount.
- When you sell the property in the future, you must apply the same discount for the next buyer.
| Item | Amount |
|---|---|
| Market Value of Property | £200,000 |
| Discount (30%) | £60,000 |
| You Pay | £140,000 |
| Deposit Needed (5%) | £7,000 |
| Future Selling Price (10% Rise) | £220,000 |
| New Buyer Price (30% off) | £154,000 |
What Deposit Do I Need?
You’ll need a minimum 5% deposit based on the discounted price of the home.
For example:
- If your discounted price is £140,000, a 5% deposit would be £7,000.
Some major lenders like Halifax and Nationwide offer 95% mortgages for First Homes properties.
How to Apply for the First Homes Scheme in 2025
Unlike older government schemes like Help to Buy, First Homes does not have a central application portal. Here’s how you can apply:
Step-by-step Guide:
- Search for new-builds in your area that are part of the First Homes scheme.
- Contact the housing developer (like Taylor Wimpey or Barratt Homes).
- Check with your local council for First Homes updates.
- Speak to a mortgage broker to understand your financing options.
- Once approved, complete the First Homes application form via your developer and local council.
Latest Updates in 2025
- The First Homes scheme was launched in 2021.
- As of 2025, thousands of new properties have been included in the scheme across England.
- More homes are being added each year based on government targets.
- It’s important to check local council websites regularly, as availability depends on your area.
Pros and Cons of the First Homes Scheme
✅ Benefits
- Get a huge discount of up to 50%
- Lower deposit needed
- Smaller monthly mortgage payments
- Homes stay affordable for future key workers
❌ Downsides
- Homes are limited in number and location
- You can’t sell for full market value
- There is no central website for easy access—you have to do some research
- Not compatible with Shared Ownership or Help to Buy
Can I Combine the First Homes Scheme with Other Schemes?
Yes, but with limitations. Here’s what you can combine:
| Scheme Name | Can Combine with First Homes? | Notes |
|---|---|---|
| Lifetime ISA (LISA) | ✅ Yes | Use LISA savings as deposit |
| Mortgage Guarantee | ✅ Yes | Helps with 95% mortgage |
| Shared Ownership | ❌ No | Not compatible |
| Help to Buy | ❌ No | Scheme ended in 2023 |
| Own New Rate Reducer | ⚠️ Maybe | Check with lender |
Always check eligibility rules before combining.
Final Thoughts
The First Homes scheme is a great opportunity for first-time buyers and key workers to buy their own home at a lower cost. While there are a few limitations, the long-term savings and affordability make it a strong option.
If you’re dreaming of owning a home in 2025, it’s worth checking if First Homes is available in your area.
Still have questions?
Visit your local council’s website or talk to a mortgage advisor to explore your options.
Written by: Housing Market News
Your trusted source for real estate tips and buyer guides.
