What is the First Homes Scheme? A complete guide for first time buyers in England

First, it’s important to understand that the First Homes Scheme operates only in England. It’s a Government initiative designed to help first-time buyers and key workers onto the property ladder.

Under this scheme, eligible homes are sold at a 30% to 50% discount compared to market value, making them more affordable for people who qualify.

The scheme is also intended to support local communities: priority is often given to local residents and workers. In practice, when a home is first offered, it may be subject to local eligibility criteria set by the relevant council.

Who Qualifies for the First Homes Scheme?

To be eligible, you must meet all of these conditions:

• Be 18 years of age or over.
• Be a first-time buyer. If you’re purchasing jointly, all buyers must be first-time buyers.
• Be able to secure a mortgage covering at least 50% of the discounted purchase price.
• Earn less than £80,000 per year (before tax) or £90,000 if buying in London. If buying with someone else, the combined household income must stay under these thresholds.
• Meet any additional local eligibility rules imposed by the local authority.

Local authorities may prioritise certain groups during the initial sales window. These priorities often include:

• Key workers (as defined locally).
• Individuals who already live or work in the area.
• Those on lower incomes who would otherwise struggle to purchase.

Important exception: the Armed Forces

If you are a current member of the armed forces, or have left in the past five years, the local priority rules generally do not apply to you. The same concession often applies if your (ex)spouse or civil partner was in the forces, or if you’re a widow(er) of someone whose death was service-related.

How the Scheme works

Finding a Qualifying Home

To take advantage of the First Homes Scheme, you’ll first need to find a home that’s been designated under it. These may be new builds or homes being resold under the scheme. The home must fall within a maximum price limit after discount, which is:

• £250,000 (outside London)
• £420,000 (in London)

However, local councils may impose lower thresholds in their area, so always check the specific rules for your location.

Once you’ve identified a property, an independent surveyor will appraise it to confirm that the discounted price aligns with its market value.

New Build or Resale?

Homes sold through the scheme can be:

• New build properties (either under construction or recently completed).
• Resales of properties initially purchased under the First Homes scheme. In that case, the resale is typically conducted through a standard estate agent process, but the discount mechanism remains embedded in the sale.

Applying via Developer and Council

When you’ve found a suitable home, the developer will review your eligibility, guide you through the application process, and then forward your application to the local council for approval.

If successful:

• You’ll need to arrange a mortgage that covers at least 50% of the purchase price (after discount).
• You’ll instruct a conveyancing solicitor to handle legal formalities.
• The council will communicate with your conveyancer, the developer, and (if applicable) your mortgage advisor before finalising the discount.

The discount isn’t a grant, it’s built into the property title. In other words, when you resell, the lower price condition remains.

Things to be aware of

• Eligibility checks are stringent. Failing to meet any single criterion may disqualify you.
• The local criteria window means early applicants who qualify locally are prioritised. After this period, remaining homes may be offered more widely.
• Even though local authorities can set looser or stricter rules, the scheme is still bound by national limits on income, discount and mortgage share.
• Council thresholds may vary considerably depending on location. Always check the rules in your area.

Why the First Homes Scheme matters for buyers

The First Homes Scheme represents one of the more accessible routes for first-time buyers in England to secure a property with a significant discount built in. Because the discount is embedded in the sale, future buyers must also adhere to those rules, helping to maintain affordability for subsequent homeowners.

For those who qualify, it provides a realistic step into homeownership, particularly in high-cost areas where saving for a deposit and obtaining a mortgage can be prohibitive.

Quick summary

• The First Homes Scheme is a government initiative in England to help first time buyers and key workers buy homes at a 30-50% discount.
• You must be 18+, a first-time buyer, have a mortgage for at least 50%, and have an income below £80,000 (or £90,000 in London).
• Local authorities can apply priority rules, often in the first three months of marketing. Exceptions exist for the Armed Forces.
• Eligible homes have price caps of £250,000 (outside London) or £420,000 (in London), though local councils may reduce these.
• Homes may be new builds or resales under the scheme, and the discount is recorded in the title, remaining for future sales.
• The developer sends your application to the local council; if accepted, you proceed with mortgage and conveyancing steps.

Learn more about the First Homes Scheme