Government support for new-build homebuyers

Buying a new build home can be an exciting prospect, but getting together a deposit and finding an affordable mortgage can be a challenge.

Fortunately, there are several government-backed home ownership schemes that could help make buying a new build more achievable. From discounted properties to deposit-saving incentives and 5% deposit mortgages, there are options available for different types of buyers.

The best scheme for you will depend on your circumstances, including your income, deposit, whether you are a first-time buyer and where you want to buy.

First Homes Scheme

The First Homes scheme is designed to help eligible buyers purchase a property at a discount of at least 30% compared with its market value.

The scheme is mainly aimed at first-time buyers and can be available on selected new build homes.

A discount can make a significant difference to the amount you need to borrow. For example, a £300,000 home with a 30% discount would cost £210,000.

There are eligibility requirements, including income limits and rules about the property’s value. You will also need to find a property that is being offered through the First Homes scheme.

For eligible first-time buyers, First Homes can be one of the most valuable ways to reduce the cost of buying a new build home.

Learn more about First Home Scheme.

Shared Ownership

Shared Ownership provides another route onto the property ladder if buying a home outright is currently out of reach.

With Shared Ownership, you buy a share of a property and pay rent on the remaining share. The initial share you can purchase will depend on the property and the housing provider.

For example, if a new build home is worth £300,000 and you buy a 25% share, your share would be worth £75,000. Your mortgage and deposit would generally be based on the share you are purchasing rather than the full property value.

You can usually buy additional shares in the property later. This is known as staircasing.

Shared Ownership can be particularly useful for buyers who can afford monthly housing costs but are finding it difficult to save a large deposit.

However, remember to factor in rent and any service charges alongside your mortgage payments when working out the total monthly cost.

Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme can help buyers who have a smaller deposit.

The scheme supports participating mortgage lenders in offering mortgages with deposits as low as 5%. This could mean you do not need to save 10% or more before buying a new build home.

For example, a 5% deposit on a £300,000 property would be £15,000.

The government does not provide the deposit itself. Instead, the scheme gives participating lenders additional protection, helping them offer higher loan-to-value mortgages.

The scheme is not limited to first-time buyers, so it may also be an option for existing homeowners who meet the lender’s criteria.

As with any mortgage, you will still need to pass the lender’s affordability and eligibility checks.

Lifetime ISA

A Lifetime ISA can help eligible first-time buyers save towards their deposit while receiving a government bonus.

You can save up to £4,000 each tax year, with the government adding a 25% bonus to your contributions.

For example, if you save £4,000, you could receive a £1,000 government bonus.

The money can be used towards buying your first home. Including an eligible new build, provided you meet the scheme’s conditions.

One important rule is that your Lifetime ISA generally needs to have been open for at least 12 months before you can use the funds for a first home.

There are also limits on the property’s purchase price and rules around withdrawals, so make sure you understand the conditions before relying on a Lifetime ISA for your deposit.

Help to Buy ISA

The Help to Buy ISA was previously a popular way for first-time buyers to save towards a deposit. However, the scheme is now closed to new applicants.

If you already have a Help to Buy ISA, you may still be able to receive the government bonus if you meet the relevant requirements.

New Build Developer Incentives

Government schemes are not the only form of help available to new build homebuyers.

House builders often offer their own incentives to attract buyers to new developments. These can vary considerably between developers and properties.

Depending on the development, an incentive could include:

• A contribution towards your deposit
• Help with legal fees
• Mortgage cost contributions
• Flooring or appliance packages
• Upgrades to the property
• Other purchase-related benefits

These are not government schemes, so the terms will vary.

When comparing new build incentives, look at the overall value rather than focusing solely on the headline offer. It is also important to understand whether an incentive affects the purchase price or your mortgage arrangements.

Which government scheme is best for new build buyers?

The right option depends on your financial circumstances and the type of property you want to buy.

First-time buyers looking for a discounted home could consider First Homes if an eligible property is available.

Buyers struggling to afford a whole property may find Shared Ownership more accessible because they initially purchase only part of the home.

Buyers with a 5% deposit may be able to access a mortgage through the Mortgage Guarantee Scheme, subject to the lender’s criteria.

First-time buyers who are still saving could consider a Lifetime ISA to benefit from the government bonus.

It is also possible that developer incentives could reduce some of your upfront costs.

Before choosing a scheme, compare the total cost of buying and owning the property rather than simply looking at the size of the initial deposit.

Frequently Asked Questions

Q1. Is there government help for buying a new build home?

A1. Yes. Depending on your circumstances, government-backed options can include First Homes, Shared Ownership, the Mortgage Guarantee Scheme and Lifetime ISAs for eligible first-time buyers.

Q2. Can first-time buyers get help buying a new build?

A2. Yes. First-time buyers may be eligible for several forms of support, including First Homes, Shared Ownership and Lifetime ISAs. Eligibility varies between schemes.

Q3. Is Help to Buy still available for new build homes?

A3. No. The Help to Buy Equity Loan is closed to new applicants. Existing Help to Buy ISAs are subject to separate rules.

Q4. Can I use a government scheme with a developer incentive?

A4. It can be possible, but it depends on the specific government scheme, lender and developer incentive. Always check the terms before committing to a purchase.

Disclaimer

newhomesforsale.co.uk is a property portal and not a financial advisor, mortgage broker or mortgage lender. Always seek independent financial advice before making significant decisions about your money, mortgages or purchasing a property.

All information included in our articles is accurate to the best of our knowledge at the time of publication. However, any references to dates, prices and availability are subject to change without notice.

Please note that stock images used on this website are licensed from Canva.com.

Publish date 28th August, 2026
Reading time: 3 minutes
Written by Heather Bowles

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