Government Schemes for First-Time Buyers in 2025
Buying your first home is a big step, and it can feel overwhelming—especially with house prices on the rise. Luckily, the government has introduced several schemes to make homeownership more affordable for first-time buyers. Here’s a breakdown of the key options available in 2025, explained in simple terms.
First Homes Scheme – Big Discounts on New Builds
The First Homes Scheme helps first-time buyers and key workers get onto the property ladder by offering new-build homes at a 30% to 50% discount. This means you could buy a property for much less than its market value.
Who can apply?
First-time buyers earning less than £80,000 per year (£90,000 in London).
The property must cost no more than £250,000 after the discount (£420,000 in London).
You must take out a mortgage covering at least 50% of the price.
Important note: If you sell the home later, you must offer the same percentage discount to the next buyer.
Shared Ownership – Buy a Home in Stages
With Shared Ownership, you buy a 10% to 75% share of a home and pay rent on the rest. Later, you can buy more shares until you own the home outright.
Who can apply?
First-time buyers or those who don’t own another home.
Earn less than £80,000 per year (£90,000 in London).
Things to keep in mind
The property is usually leasehold, meaning there may be additional charges for maintenance and services. You can increase your ownership over time by buying more shares (this is called “staircasing”).
Mortgage Guarantee Scheme – Buy with Just a 5% Deposit
The Mortgage Guarantee Scheme makes it easier for buyers with small deposits to get a 95% mortgage. This means you only need a 5% deposit.
Key details
Available for homes priced up to £600,000.
Open to first-time buyers and home movers.
Only applies to repayment mortgages (not interest-only loans).
This scheme is perfect for those with a steady income but struggling to save a large deposit.
Help to Build – Support for Self-Builders
Dreaming of building your own home? The Help to Build scheme makes it easier by offering a government-backed loan.
How does it work?
You only need a 5% deposit.
The government provides an equity loan covering 5% to 20% of costs (up to 40% in London).
You take out a self-build mortgage to cover the rest. This scheme makes self-building possible without huge upfront costs.
What Should You Do Next?
Check your eligibility – Find out which scheme works for you.
Plan your finances – Make sure you have the right deposit and mortgage options.
Get expert advice – A mortgage broker can help you apply and find the best deal.
At Prospect Tree Mortgages, we’re here to help first-time buyers make sense of these options and find the best mortgage for their needs. Get in touch today to start your journey to homeownership!
Your home may be repossessed if you do not keep up repayments on your mortgage. the information contained within was correct at the time of publication but is subject to change, 18.02.2025.
What’s Next?
If you’re thinking about moving home, remortgaging, or buying your first property, now is a great time to review your mortgage options. At Prospect Tree Mortgages, we’re here to help you understand your choices and find the best mortgage for your situation.
Get in touch with our expert advisors today to discuss how this base rate cut could benefit you. We aim to ensure you make the most of the opportunities available.
Call us at 0800 8620 840 or visit our website at www.ptmortgagesltd.co.uk to learn more.
Your home may be repossessed if you do not keep up repayments on your mortgage. the information contained within was correct at the time of publication but is subject to change, 06.02.2025.
If you’d like to learn more about mortgage products and how we can help you, please don’t hesitate to get in touch with our team. We’re here to help you navigate the ever-evolving world of mortgages and guide you toward a brighter, greener home.