The latest research from UK Property Development (UKPD) suggests that Andy Burnham’s new Your First Home proposal could save first-time buyers almost £21,500 over their first five years on the market while also halving the amount they need to raise for the initial deposit.
On 26th September, the UK government announced proposed plans for a new first-time buyer equity loan system called Your First Home, introducing a new way of helping people take their first step onto the housing ladder following the end of the previous Help to Buy scheme.
The full details of the scheme are expected to be announced during the upcoming Autumn Budget but it is expected to offer deposit requirements as low as 2.5%, accompanied by a 20% government-backed equity loan for first-time buyers purchasing a new-build home.
How important are first-time buyers for England’s housing market?
First-time buyers play an essential role in the housing market. In 2025, it is estimated that they accounted for 52.8% of all mortgages provided across the UK.
This explains why, between 1st April 2013 to 31st May 2023, 328,346 first-time buyers made use of the government’s Help to Buy scheme.
So what kind of impact could Your First Home have?
UKPD has looked at the potential benefit of Your First Home for first-time buyers.
Because many of the specific details of Your First Home are yet to be confirmed, UKPD has made these calculations on the assumption that two vital rules from the Help to Buy equity loan scheme will be carried through to Your First Home:
- Your First Home will mirror Help to Buy’s qualifying purchase price limits that were set at 1.5x the average first-time buyer price.
- The interest-free period for the government-backed 20% equity loan provided by Your First Home will be five years, as was the interest-free period provided by Help to Buy.
From here, UKPD used the following data to calculate the potential savings:
• A maximum qualifying Your First Home property value of £368,273, based on 1.5x the current average price for a first-time buyer home in England (£245,515).
• An average minimum Your First Home deposit of 2.5% (£9,207).
• The government’s 20% equity loan will come in at £73,655 (interest-free for the first five years).
• A current average first-time buyer mortgage rate of 4.49% (over 25 years) at 77.5% LTV, creating a total mortgage amount of £285,411.
Under these measures, buyers using Your First Home are looking at an average monthly mortgage repayment of £1,585. Over the interest-free five-year period, this means they’ll be paying a total of £95,087.
How does this compare to first-time buyers purchasing without Your First Home?
This means that first-time buyers using the Your First Home scheme could potentially save at least 50% on the upfront deposit requirement, and then save a further £358 per month on repayments. Across the five-year interest-free period, this creates a total Your First Home saving of £21,471.
Andy Morrison, Director of UK Property Development, commented:
“Your First Home will have an enormous impact on the new-build market, as it inevitably drives a surge in first-time buyer demand. This is, on the surface, excellent news for the economy, the housing market, and developers, not to mention the buyers themselves. However, will there be enough homes available to satisfy this demand? Because if not, the potential benefit of the scheme will be significantly muted.
While an uptick in demand will certainly be a motivator, the government also needs to find real, effective ways of incentivising developers to increase their delivery and to sign-up to the scheme. The nation’s major developers are notorious for their reluctance to deliver new homes at pace in fear of diluting the market and supposedly diminishing the value of their product. How the government plans to tempt them away from this behaviour remains to be seen.
Meanwhile, SME developers will almost certainly pick up the slack. Those who are operating on a smaller scale are less concerned with landbanking and more concerned about delivering great homes to parts of the country where people are calling out for them.”
Data tables and sources
- Your First Home information sourced from the UK government, Propertymark, and Chancellors.
- Help to Buy data sourced from the UK government (1), (2), and (3).
- Mortgage statistics sourced from the Office for National Statistics
- Full data tables and sources can be viewed online here
