Everything You Need To Know About The First Homes Scheme

With first home ownership feeling increasingly out of reach amidst soaring property prices and high demand, the government has introduced the First Homes Scheme. This initiative promises to make buying your first property more affordable by offering a significant discount on the price of selected new-build homes. But what exactly is the First Homes Scheme? Who qualifies for this government first home scheme, and how can prospective buyers take advantage of it? Let’s delve into the details.

Understanding the First Homes Scheme

Launched in June 2021, the First Homes Scheme is a government-backed initiative designed to help first-time buyers purchase their first property with a substantial discount. The core aim is to provide affordable housing solutions for local residents, with a particular focus on key workers. The scheme offers a discount of at least 30% off the market value of eligible new-build properties, potentially saving buyers up to £70,000. This makes the dream of owning a first home a tangible reality for many.

However, given the current climate of high house prices and significant demand, securing a property through the First Homes Scheme is likely to be competitive. A limited number of eligible properties are available, emphasising the need for swift action if you’re interested.

What Happens When You Decide to Sell Your First Homes Scheme Property?

A key feature of the First Homes Scheme is the perpetual nature of its eligibility. This means that if you decide to sell your home purchased through the scheme, the discount remains attached to the property for future first-time buyers. Therefore, as the initial buyer, you won’t be able to recoup the original 30% discount upon sale. Furthermore, you can only sell your First Homes Scheme property to another eligible first-time buyer.

First Home Scheme Eligibility Criteria

To be eligible for the First Homes Scheme, prospective buyers must meet several conditions:

• First-Time Buyer Status: You must be a first-time buyer. If purchasing jointly, all applicants must be first-time buyers.
• Mortgage Requirement: You need to secure a mortgage for at least 50% of the property’s purchase price.
• Location: The property must be located in England.
• Income Cap: Your total annual household income must be less than £80,000, or £90,000 if you are based in London.

It’s important to note that local authorities may implement additional eligibility criteria to prioritise local residents, especially key workers needing to live near their employment. For instance, if you are looking at Birmingham properties, the local council might have specific requirements for residents of the Birmingham area. Priority may also be given to veterans and members of the Armed Forces.

Price Caps Under the First Homes Scheme

Yes, there are price restrictions in place. To be eligible for the First Homes Scheme, the property’s price after the discount must be £250,000 or less, or £420,000 or less in London. This means that properties purchased through the scheme will not incur Stamp Duty Land Tax. Local authorities also have the discretion to further reduce these price caps in their area.

Can You Combine the First Homes Scheme with Help to Buy?

While the Help to Buy equity loan scheme is now closed to new applicants, those who already have an existing Help to Buy loan cannot use it in conjunction with the First Homes Scheme to purchase a property.

Applying for the First Homes Scheme: Your Next Steps

If you’ve identified a First Homes Scheme property in your desired location, your first step is to contact the property builder directly. They will be able to confirm your eligibility for that specific property. If you meet the criteria, the builder will guide you through the application process with the relevant local authority.

Ready to Embark on Your First Home Journey?

Buying your first home, whether through the standard market or the First Homes Scheme, can feel like a big step. At Centrick, we’re dedicated to making your first property purchase as smooth and stress-free as possible!

Our At Home With Centrick hub is your go-to resource for valuable information and guidance for first-time buyers. Explore our blog posts to learn more about the government’s First Home Scheme, other available assistance for first-time buyers in 2025, and the latest updates in the property market. If you’re ready to take the next step towards owning your first home, don’t hesitate to contact our team using the form below – we’re excited to help you find your perfect property!