First time buyer schemes 2026: every government scheme compared

If you're weighing up what first time buyer schemes 2026 has to offer, the first thing to check is whether you actually qualify as a first-time buyer. HM Revenue & Customs (HMRC) defines a first-time buyer as someone who has never owned a residential property, anywhere in the world, either on their own or jointly with someone else, and who is buying a property as their only or main home.

That definition catches out more people than you might expect. A few common edge cases are worth knowing about before you apply for any scheme.

• Inherited property: if you've inherited a share of a property, even one you never lived in or have since sold, most lenders and schemes will treat you as a previous homeowner.
• Property owned abroad: owning residential property outside the UK counts too, whether or not it was ever your main home.
• Buying jointly with a non-first-time buyer: if you buy with a partner who already owns, or has previously owned, a home, the application is usually assessed as a whole rather than treated as a first-time buyer purchase.

If you're unsure where you stand, an advisor can check your circumstances against the eligibility rules for each scheme before you start the application process.

Here's a snapshot of the main first-time buyer schemes available across the UK in 2026, including the Mortgage Guarantee Scheme, Lifetime ISA, the newly announced FTB ISA, First Homes, Shared Ownership, and the devolved nation equivalents. Full detail on eligibility and how each one works follows in the sections below.

If you'd rather skip ahead and compare first-time buyer mortgage rates directly, an advisor can talk you through live lender options once you know which scheme fits your situation.

How it works

The Mortgage Guarantee Scheme allows lenders to offer mortgages with a 5% deposit on properties worth up to £600,000. The government guarantees a portion of the loan to the lender, which is what makes lenders comfortable offering such a low deposit option. It became a permanent fixture of the market in July 2025, having previously run as a temporary scheme.

The scheme is open to both first-time buyers and home movers, so you don't need to be a first-time buyer to use it, though it's particularly useful if you haven't yet built up a larger deposit.

Who qualifies?

• UK residency
• Property price up to £600,000
• Residential purchase only - not second homes or buy-to-let
• A standard capital repayment mortgage, rather than interest-only

Not every lender participates in the scheme, and participating lenders can apply different affordability rules at higher loan-to-value. An advisor can check how much can I borrow? and which lenders are currently offering 5% deposit mortgages under the scheme.

Pros and cons

The main advantage is the low deposit barrier - it works on existing housing stock as well as new-build, and there's no income cap to worry about. The trade-off is that borrowing at 95% loan-to-value doesn't reduce how much you need to borrow overall, and options at higher loan-to-value tend to be less competitive than they are with a larger deposit. Affordability checks still apply, so a low deposit alone doesn't mean you'll be approved.

Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.

If your credit history is holding you back rather than your deposit, it's worth looking at adverse credit mortgages for first-time buyers, since some lenders specialise in this area alongside standard scheme-backed lending.

How it works

A Lifetime ISA (LISA) lets you save up to £4,000 a year toward your first home, with the government adding a 25% bonus on top, up to £1,000 a year. The account needs to have been open for at least 12 months before you can put the funds toward a property purchase, and it can only be used on properties up to £450,000.

Who qualifies?

• UK resident
• Aged between 18 and 39 when you open the account
• First-time buyer only
• Property price under £450,000

You can pay into a LISA until you turn 50, and you'll need to use the funds toward a first home, or keep them until retirement, to avoid a withdrawal charge. Withdrawing for any other reason triggers a 25% government charge, which claws back more than just the bonus, it eats into your own savings too, so it isn't a pot to dip into for other costs.

Worked example

Save £4,000 a year for three years and you'd have £12,000 in contributions. With the maximum 25% government bonus of £1,000 added each year, that's an extra £3,000, bringing your total toward a deposit to £15,000.

Can you use a LISA with other schemes?

Yes. A LISA works alongside the Mortgage Guarantee Scheme - many buyers save into a LISA and then use the Mortgage Guarantee Scheme for their mortgage once they're ready to buy. You can also hold a LISA and the new FTB ISA at the same time (more on that below).

If parents or grandparents are considering contributing to your deposit, equity release is one option some homeowners look at to release funds from their own property, though it reduces the equity available to them later and isn't right for everyone.

What is the FTB ISA?

The FTB ISA is a new first-time-buyer savings account announced in the June 2026 Budget. Unlike a Lifetime ISA, which can also be used for retirement savings, the FTB ISA is designed specifically to help first-time buyers build a deposit, and it's intended to sit alongside a LISA rather than replace it.

Because the scheme was only just announced, full details of the contribution limits, government bonus structure, and property price cap are still being finalised. Rather than quote figures that could change before you apply, it's worth speaking to an advisor for the latest confirmed terms, or checking the official government announcement directly.

Who's likely to qualify?

• First-time buyers only - unlike the LISA, it isn't intended for retirement saving
• UK residents
• Buyers who want to hold a LISA and an FTB ISA at the same time

We'll update this guide as soon as the full terms are confirmed.

How it works

First Homes offers a minimum 30% discount on new-build properties in England, and that discount stays with the property when it's eventually resold, so future first-time buyers benefit from the same reduced price. It's only available through specific developments allocated by local authorities, so stock is limited and varies significantly by area.

Who qualifies?

• England only
• New-build properties only
• Household income under £80,000 (£90,000 in London)
• First-time buyer only

Many local authorities also give priority to buyers with a local connection or in key worker roles, so it's worth checking the criteria for developments in your specific area.

Pros and cons

The discount is significant and permanent, which helps keep the property affordable for whoever buys it next. The downside is limited availability, restrictions on the resale market, and in most areas you can't combine First Homes with a Lifetime ISA.

How it works

Shared Ownership lets you buy between 10% and 75% of a property and pay subsidised rent to a housing association on the share you don't own. Most Shared Ownership properties let you "staircase", buying further shares over time until you own the property outright. It's available on new-build homes and on some resale properties too.

Who qualifies?

• Household income under £80,000 (£90,000 in London)
• Unable to buy a suitable home outright
• First-time buyer, or a previous homeowner who can no longer afford to buy

Mini cost example

On a 50% share of a £280,000 home, the purchase price for your share would be £140,000. A 10% deposit on that share works out at £14,000. You'd then pay rent to the housing association on the remaining 50% share, on top of your mortgage repayments - an advisor can talk you through current rent-setting formulas for a specific property.

Pros and cons

Shared Ownership brings down the deposit and mortgage you need, which can make homeownership possible in areas you couldn't otherwise afford. The trade-off is that you're paying rent and a mortgage at the same time, service charges often apply on top, and staircasing to buy further shares comes with its own costs each time. If you later want to remortgage after buying more of your share, it's worth reading our guide on remortgage after shared ownership.

Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.

Help to Buy - Wales

Help to Buy is still open to first-time buyers in Wales in 2026. It works on a 5% deposit plus a 20% equity loan from the Welsh Government, and it's available on new-build properties up to £300,000.

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

LIFT offers two routes: Open Market Shared Equity and New Supply Shared Equity. In both cases, the Scottish Government contributes up to 40% of the purchase price, while you hold full title to the property.

Co-ownership - Northern Ireland

Co-ownership lets you buy between 50% and 90% of a property, paying rent on the remaining share, with the option to staircase to full ownership over time, similar in structure to Shared Ownership in England.

There's no single "best" first-time buyer scheme - the right one depends on your deposit, your income, and where you want to buy. Many buyers end up combining more than one scheme, such as saving into a Lifetime ISA while planning to use the Mortgage Guarantee Scheme once they're ready to buy.

If you're feeling overwhelmed by the number of options, MoneyHelper (moneyhelper.org.uk, 0800 138 7777) offers free, independent guidance on budgeting and saving for a home. For scheme-specific eligibility, an advisor who is Financial Conduct Authority-regulated can check the options you actually qualify for - you can verify any advisor's authorisation on the Financial Conduct Authority Register.

First-time buyers in England and Northern Ireland benefit from stamp duty relief, known as Stamp Duty Land Tax (SDLT). No stamp duty is due on the first £300,000 of a property's price, with relief tapering on properties priced between £300,000 and £500,000.

On a property priced between £300,000 and £500,000, stamp duty is charged at 5% on the portion above £300,000. If the property is priced above £500,000, first-time buyer relief no longer applies, and standard stamp duty rates apply to the whole purchase price. Scotland and Wales have their own equivalent taxes (Land and Buildings Transaction Tax and Land Transaction Tax) with different first-time buyer rules, so check the position for your nation before budgeting for costs.

Full detail on current thresholds is available from HMRC's stamp duty guidance.