This guide explains the key government and lender schemes available for first-time buyers in the UK. These programmes are designed to make it easier to get onto the property ladder, reduce upfront costs, and improve mortgage accessibility.
Lifetime ISA (LISA)
- Save up to £4,000 per year.
- Government adds a 25% bonus on savings (£1,000 max per year).
- Must be open for at least 12 months before using for a home purchase.
- Can be used to buy a property up to £450,000.
- Withdrawals for non-qualifying purposes incur a penalty.
Benefits
- Rapid deposit growth due to bonus.
- Tax-free savings.
Considerations
- Early withdrawal penalty if not used for first home or retirement.
Find out more in our Ultimate Guide to Lifetime ISAs
Shared Ownership
- Buy a share of a property (usually 25% to 75%) and pay rent on the remainder.
- Deposit is required only on the share you are buying.
- Can buy additional shares later (staircasing) to eventually own 100%.
Benefits
- Lower upfront deposit.
- Monthly costs are more manageable.
Considerations
- You pay rent on the unsold share, which can increase.
- Property may be subject to restrictions on resale.
First Homes Scheme
- Discounted homes for first-time buyers, usually 30%–50% below market value.
- Available to local first-time buyers, key workers, and specific income brackets.
- Maximum property value limits apply.
Benefits
- Significant upfront discount.
- Designed to help local buyers access housing.
Considerations
- Discount must be passed on if you sell the property.
- Eligibility criteria may restrict availability.
Right to Buy / Right to Acquire
- Available to some council or housing association tenants.
- Purchase your current property at a discount.
Benefits
- Significant discount on purchase price.
- Can move from renting to ownership quickly.
Considerations
- Only available to eligible tenants.
- Discounts reduce if you already own a property.
Other Schemes
- Mortgage Guarantee Scheme: Helps lenders offer 95% mortgages with smaller deposits.
- Help to Buy (closed to new applicants in England): Government equity loan for new builds (still relevant in some regions).
- Local schemes: Certain councils may offer local deposit assistance or discounted properties.
Key Takeaways
- These schemes can reduce deposit requirements and improve mortgage affordability.
- Always check eligibility criteria before applying.
- Some schemes require repayment of discounts or government contributions upon sale.
