News Analysis: Does Your First Home offer hope for homeownership?

‘Hope’ is the buzz word being used a great deal right now. At the recent Labour Party conference in Liverpool, ‘Hope Again’ was the messaging on every podium, conference programme, escalator and delegate tea mug.

For this industry in particular, the ‘hope’ element was very much tied in to the day-before-conference unveiling of the government’s Your First Home scheme.

The first thing to say is that for years the pages of Mortgage Strategy have called for a variation of Help to Buy (which ended in 2023) to be proposed. So, on the face of it, progress.

Yes, Labour’s Your First Home bears distinct similarities to the Conservatives’ Help to Buy: both exclusively associated with new-build and intended to boost homeownership and UK housebuilding.

There is little value in stimulating demand for new homes if developers still cannot get viable schemes through in a reasonable way

However, the government is keen to point out the important differences in terms of size of the deposit, who qualifies and how the support is targeted.

Labour’s proposal pushes the buyer’s deposit requirement down from 5% to 2.5%, while retaining the 20% government equity loan.

The mooted scheme will have household-income limits and local property-price caps. The target group is those who can afford the ongoing mortgage but struggle to accumulate a large deposit.

Another differentiating factor from Help to Buy is that developers are explicitly expected to contribute. This is where the detail gets a bit vague. The amount and precise mechanism have not been announced but will be set out in the upcoming Budget.

As for what the industry makes of the scheme so far — cautious optimism probably sums it up best.

If this scheme increases the pool of buyers able to purchase a new-build, that should give developers greater confidence that there will be customers

Just Mortgages chapter managing director John Doughty, like many across the industry, has long called for the return of an equity loan scheme to help address the deposit barrier faced by so many potential first-time buyers (FTBs).

But he is keen to see the detail that the scheme so far lacks.

“We eagerly await the full details at the upcoming Budget, in particular whether the new scheme will feature a higher weighting to account for higher property prices found in London — a critical component of the original Help to Buy.”

Doughty would also love to see the scheme include pre-owned properties to maximise the opportunity and unlock more potential buyers.

This is not currently up for discussion.

Government cannot keep adding costs to the delivery of the very homes it is trying to help people buy

Association of Mortgage Intermediaries chief executive Stephanie Charman agrees that the success of the scheme will depend on getting the detail right — much of which needs clarification.

She adds: “We also need to understand how the property price caps will interact with existing FTB stamp duty thresholds, and whether sufficient suitable new-build homes will be available in the areas where buyers need them.”

District & County Investments commercial director Michael Clifford argues that, from a developer’s perspective, one of the main challenges right now is not necessarily a lack of underlying demand for good-quality housing but uncertainty around sales rates and how quickly buyers can complete.

“If this scheme increases the pool of buyers able to purchase a new-build property, that should give developers greater confidence that there will be customers for the homes they are building,” says Clifford.

We need to understand whether sufficient suitable new-build homes will be available in the areas where buyers need them

But he adds: “The details will be important, particularly around the property price caps, eligibility criteria, developer contribution and how quickly the scheme can be implemented.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, says: “Extending a scheme to all homes would be so much better than simply targeting new-builds, and I cannot see a huge issue in doing so.

“That said, any stimulus for the housing market is a good thing. The market is flat and needs some intervention to kickstart it.”

Hampshire Trust Bank managing director of development finance Neil Leitch accepts that helping FTBs overcome the deposit barrier should be welcomed but argues that, unless the government sorts out the planning process, there is a danger much of this will become pointless.

He says: “There is little value in stimulating demand for new homes if developers still cannot get viable schemes through the system in a reasonable and predictable way.”

We eagerly await the full details, in particular whether the new scheme will feature a higher weighting to account for higher property prices found in London

Leitch adds that the requirement for participating developers to contribute towards the scheme also needs careful thought. Developers already face significant upfront planning costs and additional requirements associated with building safety.

“These costs are not experienced in isolation. They accumulate within the same appraisal and directly affect viability. Government cannot keep adding costs to the delivery of the very homes it is trying to help people buy.”

All eyes are now on new chancellor John Healey’s first Budget on 28 October, when the finer details of this scheme — we hope — will be clearly laid out!

This article featured in the October 2026 edition of Mortgage Strategy.

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