First Homes Scheme
What is the First Homes scheme? First Homes is the new government policy that offers first-time property buyers (FTBs) in England, including London, to buy a new build home with up to a 50% discount. In our catalogue you can see all offers of new homes near you on a map - see homes near me. Or read this article to the end and find out more about the scheme.
This discount permanently applies to the new home, meaning that the property can be resold only to similar new first-time buyers who will get the same discount. This is set to reduce the demand and increase your profit potential.
Key criteria for London (and England) in 2026
The following list contains essential eligibility requirements and scheme parameters which include London-specific information for each point:
- All buyers who purchase the property need to qualify as first-time homebuyers.
- The annual household income must stay below £90,000 for London residents who want to purchase a home.
- The income limit for first-time buyers outside London stands at £80,000.
- The discounted property price must stay below £420,000 in London but £250,000 in other areas.
- The minimum discount amount for property purchases stands at 30% but some developments and local authorities offer 40% or 50% discounts.
- The property must serve as your primary residence because you need to purchase it for personal use. The scheme prohibits any use of the property as a rental investment.
- The scheme allows developers and local authorities to establish their own eligibility standards which might favor residents and essential workers and people who live in the area.
- The discount percentage from your property sale must transfer to the next eligible buyer who participates in the scheme thus preventing you from receiving full market value unless you leave the program.
Eligibility Criteria for the First Homes scheme
Who qualifies for the First Homes scheme, and which new build properties can FTBs purchase with a discount?
- You have to be at least 18 years old.
- You must be a first-time property buyer.
- You are able to get a mortgage for at least 50% of the home value.
- Your yearly income is less than £80,000 (£90,000 for London buyers).
Besides, local councils may set additional requirements for the buyers and give priority to:
- Essential workers
- People living in that area of the desired home
- Buyers with lower-end income
Note that armed forces and their families are exempt from the additional council requirements if they meet certain conditions. Check more at gov.uk.
Which new builds are suitable for the First Homes scheme?
There are strict eligibility requirements for the new build properties under the First Homes scheme. A property can be:
- A new build home delivered by a developer
- A new home from someone else who bought it via the scheme
- Post-discount price cannot exceed £250,000 (£420,000 in London)
How does the government's First Homes scheme work?
A buyer looks for suitable new build homes in the desired area. Developers typically advertise if a home is suitable for the First Homes scheme to help buyers know their options.
Such homes are sold with a discount between 30% and 50% of the market value. Each property is valued by an independent surveyor who checks that the discount is based on the real market price.
How does the First Homes Scheme Purchase Go?
There are several steps that an aspiring FTB has to take to buy a new build via the First Homes scheme.
Step 1 – Find a suitable new home
First, a buyer finds a suitable new property for the scheme. 1newhomes allows users to see current offers from all new-build developers across London to help ambitious buyers. We continually update our catalogue, so buyers can find all First Homes properties in London.
Step 2 – Getting a mortgage in principle
A buyer needs a mortgage in principle (AIP) to reserve a property. Be sure to have a professional broker who finds the most attractive offers for you.
Step 3 – Contacting the developer
Once you find a suitable home and have an AIP, contact the developer (or estate agent) and fill in the application that is sent to the local council. Also, you will need to pay a fee if you buy a new build. If the application is successful, you proceed to the next steps. If not, you get the fee back.
Step 4 – Conveyancing
The next step is to hire a conveyancer, a solicitor that assists you with the purchase. Make sure you and the solicitor are following local council requirements.
Step 5 – Getting Authority to Proceed
If your application is successful, you will receive an Authority to Proceed and Eligibility Certificate. You give them to your conveyancer and lender (or broker), so they can start the final stage of the process.
First Homes Stamp Duty Land Tax
Note that you still have to pay the SDLT for your First Homes property. The amount is based on the post-discount price.
Available First Homes Scheme Property In London
The First Homes scheme only launched in the Summer of 2021, and the range of participating new developments is limited. In fact, there are currently no offers in London. But as the Help-to-Buy scheme ends in early 2023, this is very likely to change, as well as the number of lenders offering First Homes mortgages.
What this means for someone looking in London in 2026
First Homes provides first-time buyers in London who earn under £90k with access to new-build homes at discounted prices. The program allows you to purchase a home at a reduced price while paying less for your mortgage and you will support future homebuyers who meet the eligibility criteria.
You need to verify which London developments participate in First Homes because not all new developments offer this program. You need to verify the local authority rules for local connection and key-worker priority status. The discount covenant which applies to First Homes properties will reduce their resale value compared to standard market homes.
New homes in London
All new homes →
Frequently Asked Questions
FAQ
The scheme provides substantial value to eligible buyers who meet first-time buyer criteria and income limits because it offers better terms than typical market transactions when mortgage rates become more favorable.
There are multiple pros to buying a new home via First Homes. Most importantly, the scheme allows stepping onto a property ladder with a small deposit and save a lot on the market value.
Homebuyers can easily discover available properties by using online real estate platforms which showcase new construction projects and affordable housing opportunities. First Homes government-backed schemes have their own section on developer websites.
The website 1newhomes.com (which covers London and UK new-builds) offers current information about new construction projects along with their prices and qualification requirements. The website allows users to search for developments by location and developer and scheme type to find participating projects.
The dedicated portal 1newhomes.com offers the simplest way for homebuyers to begin their search.
A First Homes purchase allows you to use your Lifetime ISA funds (if you have one) for deposit assistance. The First Homes scheme prevents participants from using it with Shared Ownership and Help to Buy Equity Loan scheme because these programs operate through different systems.
The final price (after the discount) cannot exceed £420,000 in London (250,000 in other regions).
- Identify builders and developments participating in the First Homes scheme;
- Get in touch with the builder to ascertain whether you meet all eligibility criteria mentioned in the First Home scheme;
- If you meet the requirements, the builder will assist you in submitting your application to the local authority.
The First Home discount applies to the property during its initial purchase. It remains tied to the property during subsequent resales. The eligibility criteria remain the same, and when you decide to sell your home, you must sell it to another first-time buyer who meets the scheme's criteria. The new buyer will also benefit from the akin discount you received earlier.
Yes, there are priorities in giving First Home discounts based on local eligibility criteria set by councils. For instance, some councils may prioritize the following groups:
- Key Workers: As defined by the council.
- Local Residents: People who already live in the area.
- Lower Income Individuals: Those on lower incomes.
If you’re purchasing with others, all buyers must meet any local income criteria, but only one person needs to meet other local criteria. These local priorities are applicable only during the first three months that a property is on sale.
Yes, there are specific exemptions for members of the armed forces and their families. If you fall into any of the following categories, you do not need to be a key worker or live in the area to qualify for First Home discounts:
- Current Members of the Armed Forces: Serving personnel are exempt from these criteria.
- Former Spouses or Civil Partners: If you are divorced or separated from a member of the armed forces, you are still eligible.
- Widows or Widowers: If your spouse or civil partner's death was caused wholly or partly by their military service, you are exempt.
- Veterans: Those who left the armed forces within the last five years also qualify for this exemption.
