First-time buyer schemes: shared ownership, First Homes, Right to Buy and more

Buying your first home can be tough, but there are various schemes available to help you boost your savings and reduce the upfront costs of getting on the property ladder 

With more than a dozen different schemes currently in operation, Which? has cut through the noise to explain each of them clearly and simply, including key eligibility rules and how to apply.

Deposit-saving schemes, including lifetime Isas

Lifetime Isa (UK-wide)

Lifetime Isas allow savers to deposit up to £4,000 a year and get a bonus of 25% from the government. The bonus can be redeemed when you buy your first home or withdraw money towards your retirement (after the age of 60). Withdrawals for other reasons are subject to penalties. 

• Key criteria: you must be aged 18-39 to open an account. Bonuses can only be used on properties priced up to £450,000. You’ll need to have your account for at least 12 months before you can withdraw the bonus.
• How to apply: you need to apply direct with a provider. See our guide on the best lifetime Isas to find out more about how they work and which providers currently offer the best rates.

Help to Buy Isa (existing account holders only)

Help to Buy Isas are savings accounts that offer a 25% bonus from the government when you buy your first home. 

They’re no longer open to new applicants, but if you already have an account you can continue to save up to £200 a month. The maximum bonus you can get when buying a home is £3,000 (on total savings of £12,000).

 If you’re ready to buy a home, contact your provider for information on closing your account and claiming your bonus.

Schemes to make buying cheaper, including shared ownership and First Homes

Shared ownership (UK-wide)

Shared ownership schemes allow you to buy a stake in a new-build property from a housing association and pay rent on the remainder. 

In England, the minimum initial stake you can purchase is 10%, but many schemes require you to buy at least 25%. You’ll need to put down a deposit of at least 5% of the share you’re buying and take out a mortgage to cover the remaining 95% of the share.

Shared ownership schemes are popular with first-time buyers in more expensive areas such as London. However, the combined cost of the mortgage, rent and service charges can be very high.

Shared ownership schemes are available elsewhere in the UK, but rules differ. See the governments’ guidance on shared ownership in Scotland, Wales and Northern Ireland.

• Key criteria (England): you’ll need to have a household income of £80,000 or less (£90,000 or less in London). All shared ownership properties are leasehold.
• How to apply (England): contact a housing association that offers shared ownership schemes. The government provides guidance on finding shared ownership homes.

First Homes (England only)

This scheme allows first-time buyers in England to get a discount of at least 30% on market value when buying a new-build home. 

Local authorities can decide who gets priority for the first three months that homes are on sale. For example, some may offer first pick to key workers or people already living locally. 

• Key criteria: only available to first-time buyers who have a household income of £80,000 or less (£90,000 or less in London). New-build properties valued at up to £250,000 (£450,000 in London) are eligible.
• How to apply: properties available under the scheme aren’t advertised in one place. Instead, you’ll need to seek out local developments in your area and see if they are offering a First Homes discount.

Help to Buy equity loans (Wales only)

The only nation still offering Help to Buy equity loans is Wales, where first-time buyers can get a 20% equity loan from the government when they buy a new-build property. 

You must have a deposit of at least 5% of the purchase price, and be able to take out a mortgage for the remaining 75%. 

• Key criteria: only available on properties priced up to £300,000. Loans must be repaid within 25 years. The scheme will run until March 2025.
• How to apply: find further information on the scheme and a list of participating housebuilders in the Welsh government’s guide.

Low-cost Initiative for First Time Buyers (LIFT; Scotland only)

There are two LIFT schemes available for first-time buyers in Scotland.

Open Market Shared Equity (OSME)

First-time buyers purchase a share of a property (usually 60% to 90%), with the government holding the remaining amount. The buyer will be named as the sole owner, but the government keeps a ‘security’ on the property to protect its share. 

Price thresholds are set based on the size of the property. 

Find out more about the scheme, including how to apply, in the Scottish government’s guide.

New Supply Shared Equity (NSSE)

The NSSE scheme is similar to the OSME scheme, but is only available on new-build homes. To qualify, you’ll need to be able to show you can’t afford to buy a new-build home that suits your needs without help from the scheme.

Find out more in the Scottish government’s guide.

Discount Market Sale (aka Council Shared Equity; London only)

This scheme, offered by some London councils, allows first-time buyers to get a discount of around 20% on a new-build property. 

The buyer will officially own the property, and won’t need to pay rent on the council’s share. When the property is sold, the buyer will only get the proceeds from the share of the property they own.

• Key criteria: rules vary depending on your council, but you’ll need to live or have worked in the borough for a set number of years. Additionally, your household income is not allowed to exceed 45% of the purchase price of the property.
• How to apply: you can find out more about the scheme and how to apply on the Share to Buy website.

Forces Help to Buy (UK-wide; armed forces personnel only)

Forces Help to Buy is designed for first-time buyers and personnel who need to move due to an assignment or extenuating circumstances. 

Armed forces personnel can borrow up to 50% of their annual salary (up to £25,000) interest-free to put towards a house deposit and additional costs of buying a home.

• Key criteria: only available to armed forces personnel in regular service. Applicants need to have served for at least one year and have at least six months left to serve. Loans are interest-free but must be repaid within 10 years.
• How to apply: find out more about the scheme from the Armed Forces Financial Services.

Schemes to help you get a mortgage

95% mortgage guarantee scheme (UK-wide)

This scheme was introduced by the government after the pandemic to encourage lenders to offer 95% mortgages. To provide an incentive, the government partially compensates lenders who offer 95% loans if the borrower misses a mortgage payment. 

• Key criteria:  to qualify for the scheme, lenders must offer repayment mortgages at between 91% and 95% loan to value. Loans can only be offered on properties priced up to £600,000. The scheme will run until 30 June 2025.
• How to apply: deals available under the scheme are no different to standard mortgages, so you’ll be able to apply for them directly with lenders or via a mortgage broker. 

Rent and Right to Buy schemes

Right to Buy (England and Northern Ireland only)

Right to Buy allows council tenants to buy their home at a discount on its market value. The discount you’ll be offered depends on how long you’ve been a council tenant and the type of property you’re buying, as well as its value. 

In England, the maximum discount is £102,400, or £136,400 in London. 

The rules can be complicated, but the government provides several resources to help you find out more: 

Northern Ireland offers its own version of Right to Buy, the House Sales Scheme, which allows eligible tenants of the Northern Ireland Housing Executive to buy their homes at a discount.

Rent to Buy (England only; excludes London)

Rent to Buy helps tenants to save a house deposit by offering them a reduced monthly rent. Eligible properties usually offer a 20% discount on market rent, and tenancies last for two years. 

• Key criteria: to qualify for Rent to Buy, you must be in full or part-time employment and be able to pay your rent and save for a deposit at the same time. If you need more time to save a deposit after the two-year tenancy period, your landlord may agree to extend your contract.
• How to apply: the government provides guidance on applying for Rent to Buy.

London Living Rent (London only)

This scheme offers Londoners the opportunity to rent a home at a discount on market rate, giving them time to save up a deposit to buy the property on a shared ownership basis. 

Rent prices must be set at least 20% below market rate, and price caps are enforced by the Greater London Authority.

• Key criteria: you’ll need to live or work in London and have a maximum household income of £60,000. You’ll need to show that you can’t afford to buy a home (including via shared ownership) in your local area.
• How to apply: the Mayor of London website provides a full guide to London Living Rent. You can find available properties on the Homes for Londoners website.

Rent to Own (Wales only)

This scheme allows tenants in Wales to build up a deposit while they rent a home. Tenancies last up to five years. 

After this time, you’ll be given a payment of 25% of the rent you’ve paid to use as a deposit towards purchasing the property. You’ll also benefit from 50% of any uplift in the property’s value during the time you’ve been renting it. 

• Key criteria: your annual household income must be £60,000 or less. You’ll need to show you can’t afford to buy a suitable property on the open market.
• How to apply: the Welsh government provides a guide to finding a participating landlord in your area.

Rent to Own (Northern Ireland only)

Rent to Own allows tenants to pay a fixed market rent for a three-year period, with the ability to buy their home any time after the first year. At the end of the tenancy, the tenant gets 20% of the rent they’ve paid to use towards a deposit to buy the property.

• How to apply: the government services website provides a guide on Rent to Own eligibility.

Other options for first-time buyers

Home ownership schemes can be a great option for some buyers, but they’re not right for everyone. Before rushing in, it’s worth considering the following:

• Can I get help from family? The Bank of Mum and Dad plays an important role in helping some people onto the property ladder, but this doesn’t always come in the form of a lump-sum cash deposit. See how parents can help first-time buyers for a full guide to your options, including guarantor mortgages.
• Can a broker find me something suitable? Some mortgages are targeted specifically at first-time buyers, including deals that allow buyers to borrow extra or buy a home with a smaller deposit. Consider speaking to a mortgage broker about standard low-deposit options and more innovative deals specifically for first-time buyers.
• Could I borrow for longer? First-time buyers are taking out mortgages with longer repayment periods than in the past, with some deals now stretching over 35 or even 40 years. A longer mortgage term is worth considering as it can boost your borrowing options, but it does mean you’ll pay more in interest in the long run. See our story on marathon mortgages for more advice.