Buying your first home can feel as though every conversation involves another expense.
Deposit.
Solicitor.
Survey.
Mortgage fees.
Moving costs.
Furniture.
Then somebody casually mentions Stamp Duty and you start wondering whether living with your parents forever might be financially underrated.
But first-time buyers do have access to a number of benefits, allowances and schemes that can potentially make buying a home more achievable.
The problem is that they’re not always explained particularly well.
I regularly speak to first-time buyers who know they’ve heard of things like Stamp Duty relief, Lifetime ISAs, 95% mortgages, First Homes and Shared Ownership, but aren’t completely sure what they actually do or whether they qualify.
There is also a lot of outdated information still floating around online.
So let’s simplify it.
What Benefits Do First-Time Buyers Get in the UK?
Depending on where you live and your circumstances, first-time buyer support can include:
- First-Time Buyers’ Stamp Duty relief.
- The Lifetime ISA Government bonus.
- First Homes discounted properties.
- Shared Ownership.
- 95% mortgages supported by the permanent Mortgage Guarantee Scheme.
- Existing Help to Buy ISA bonuses for people who already have an account.
- Certain mortgage products specifically aimed at first-time buyers.
- Gifted deposits from family, subject to lender requirements.
- Local affordable-homeownership schemes.
But you won’t necessarily qualify for all of them.
Some schemes only operate in England.
Some have income limits.
Some have property-price limits.
And some things described as “first-time buyer benefits” aren’t actually Government benefits at all.
That’s why I’d look at your individual circumstances rather than building your home-buying plan around a checklist you’ve found online.
What Actually Counts as a First-Time Buyer?
This is more important than it sounds.
For many first-time buyer benefits, you generally need to have never previously owned residential property.
That can include property outside the UK.
So if you owned an apartment abroad ten years ago, sold it and have rented ever since, you may not qualify as a first-time buyer for certain purposes.
Likewise, simply selling your previous property doesn’t reset the clock.
You’ve still previously owned one.
Inherited property can also affect your status depending on the ownership interest you acquired.
Different schemes have their own detailed eligibility rules, so don’t assume that qualifying for one automatically means you’ll qualify for everything else.
First-Time Buyer Stamp Duty Relief
For buyers in England and Northern Ireland, one of the most valuable first-time buyer benefits can be Stamp Duty Land Tax relief.
Under the current rules, qualifying first-time buyers purchasing a home for £500,000 or less pay:
0% Stamp Duty on the first £300,000
and
5% on the portion between £300,001 and £500,000.
If the property costs more than £500,000, First-Time Buyers’ Relief isn’t available and the normal residential Stamp Duty rates apply to the whole purchase.
How Much Could First-Time Buyer Stamp Duty Relief Save Me?
Imagine you’re buying your first home for £350,000 in England.
As a qualifying first-time buyer:
First £300,000: £0
Remaining £50,000 at 5%: £2,500
Your Stamp Duty would therefore be:
£2,500
Under the standard residential rates, the Stamp Duty on the same £350,000 purchase would currently be £7,500.
So in this example, first-time buyer relief saves:
£5,000
That’s meaningful money when you’re already funding a deposit, solicitor, survey and moving costs.
Didn’t First-Time Buyers Pay No Stamp Duty Up to £425,000?
They did for a period.
And this is exactly why I’d be careful with older articles and social-media posts.
The temporary higher thresholds ended on 1 April 2025.
The first-time buyer nil-rate threshold returned to £300,000, with relief available only where the overall property purchase price is £500,000 or less.
If you’ve seen somebody online still quoting £425,000 and £625,000, you’re probably looking at information based on the previous temporary rules.
What If I’m Buying With Someone Who Isn’t a First-Time Buyer?
This can make a big difference.
For First-Time Buyers’ Stamp Duty Relief, every purchaser normally needs to qualify as a first-time buyer.
Imagine you’ve never owned property but your partner previously owned a flat.
If you’re buying together, you wouldn’t normally qualify for First-Time Buyers’ Relief simply because one of you is buying for the first time.
This is something I’d establish early because it can materially change the amount of money you need for completion.
What About First-Time Buyer Property Tax in Scotland and Wales?
Property taxation works differently around the UK.
Scotland
Scotland uses Land and Buildings Transaction Tax, usually shortened to LBTT.
Qualifying first-time buyers currently benefit from a higher nil-rate threshold of £175,000.
The relief can save up to £600 compared with the normal residential LBTT calculation.
Wales
Wales uses Land Transaction Tax, or LTT.
There isn’t currently a specific first-time buyer LTT relief.
That doesn’t necessarily mean a Welsh first-time buyer will pay property tax, because whether LTT is payable still depends on the property’s value and the applicable tax bands.
The important point is that you shouldn’t use an English Stamp Duty calculator for a property purchase in Wales or Scotland.
The Lifetime ISA: Potentially £1,000 a Year From the Government
For someone planning ahead for their first home, the Lifetime ISA, commonly called a LISA, can be extremely useful.
You can currently contribute up to:
£4,000 per tax year
and the Government adds a:
25% bonus.
So if you contribute the full £4,000, the Government adds:
£1,000
giving you:
£5,000
before taking account of any interest or investment growth.
If two eligible first-time buyers each have their own Lifetime ISA and both meet the rules, both can potentially receive their own Government bonuses.
Over several years, that can make a substantial difference to a deposit.
What Are the Lifetime ISA Rules for Buying a House?
To use Lifetime ISA funds towards a qualifying first-home purchase without the normal withdrawal charge, the property must currently cost:
£450,000 or less.
You also need to have made your first payment into the Lifetime ISA at least 12 months before the purchase.
The purchase must be made using a mortgage, and the Lifetime ISA funds are normally transferred to your solicitor or conveyancer as part of the transaction.
The property needs to be somewhere you intend to live.
It’s not designed for purchasing your first Buy-to-Let investment.
One Lifetime ISA Mistake I Would Avoid
Don’t open one six weeks before you’re planning to complete on a house and expect the Government bonus to solve your deposit problem.
The 12-month rule matters.
If you’re eligible for a Lifetime ISA and think you might buy your first home in the future, it’s worth understanding the rules well before you start viewing properties.
That doesn’t mean a Lifetime ISA is automatically appropriate for everybody.
Withdrawing money for a non-qualifying reason can normally result in a 25% withdrawal charge, so you should understand the restrictions before paying money in.
What About Help to Buy ISAs?
You cannot open a new Help to Buy ISA anymore.
But this doesn’t mean existing accounts are useless.
If you already have a Help to Buy ISA, you can currently continue contributing up to £200 per month until November 2029.
Eligible account holders can claim the Government bonus until November 2030.
The Government bonus is 25% of eligible savings, up to a maximum bonus of:
£3,000
To receive the maximum, you would need £12,000 of eligible savings.
Property-price limits apply.
The qualifying property can currently cost up to:
£250,000 outside London
or
£450,000 in London.
So if someone tells you:
“Help to Buy ISAs don’t exist anymore”
the more accurate answer is:
You can’t open one anymore, but existing account holders can still potentially benefit from them.
Is the Help to Buy Equity Loan Still Available?
Not in England.
The Help to Buy Equity Loan scheme closed to new applications some time ago.
I still see it mentioned in old articles about first-time buyer support, which understandably causes confusion.
If you’re buying now, don’t build your plans around getting a Help to Buy Equity Loan in England.
There are other current schemes worth considering instead.
What Is the Mortgage Guarantee Scheme?
The UK now has a permanent Mortgage Guarantee Scheme designed to support the continued availability of mortgages between 91% and 95% loan-to-value.
In practical terms, this can help support lenders offering mortgages where the buyer has a deposit as small as:
5%.
But there’s an important misconception to clear up.
The Government doesn’t give you the other 95%.
And it doesn’t give you a 5% deposit.
You still provide your deposit and borrow the remainder from a mortgage lender.
The Government guarantee sits behind the mortgage and provides participating lenders with protection against part of their potential losses.
Does the Mortgage Guarantee Scheme Guarantee I’ll Get a Mortgage?
No.
The word guarantee refers to the arrangement between the Government and participating mortgage lenders.
It isn’t a guarantee that your mortgage application will be accepted.
You still need to satisfy the lender’s:
- Affordability requirements.
- Credit assessment.
- Income criteria.
- Property requirements.
- General lending criteria.
And not every 95% mortgage is necessarily part of the Government scheme.
Lenders can offer high loan-to-value mortgages outside it too.
The important thing for a first-time buyer is that 5% deposit mortgages are available in the market, subject to eligibility and lender criteria.
Is a 5% Deposit Mortgage a Good Idea?
It can help somebody buy sooner.
But that doesn’t make it automatically suitable.
Borrowing 95% of the property’s value means you’re starting with relatively little equity.
That can mean:
- Higher mortgage rates compared with lower loan-to-value products.
- Higher monthly payments.
- Greater sensitivity to property-price falls.
- Fewer mortgage choices compared with somebody with a larger deposit.
For example, if you bought a £250,000 home with a £12,500 deposit, you’d initially have 5% equity.
If property values subsequently fell, your equity could reduce significantly.
That’s why I’d compare buying with a 5% deposit against waiting and saving more rather than simply assuming one route is better.
What Is the First Homes Scheme?
The First Homes scheme is available in England and allows eligible first-time buyers to purchase certain properties at a discount of at least:
30% below market value.
In some areas, local authorities can require discounts of:
40% or 50%.
This can make a substantial difference.
Imagine a qualifying property with a market value of £300,000 and a 30% First Homes discount.
The purchase price would be:
£210,000
You’re not borrowing the £90,000 discount from the Government.
And unlike Shared Ownership, you don’t pay rent on that discounted portion.
You purchase the property at the reduced price.
Who Qualifies for First Homes?
There are national eligibility rules.
Generally, all purchasers need to be first-time buyers.
Your combined annual household income must normally be no more than:
£80,000
or
£90,000 in Greater London.
You’ll also normally need a mortgage covering at least 50% of the discounted purchase price.
For new First Homes, the discounted purchase price is normally capped at:
£250,000 outside London
or
£420,000 in London.
Local authorities can introduce additional criteria or lower certain limits.
For example, some properties may initially be prioritised for people who live or work locally.
What’s the Catch With First Homes?
The discount doesn’t disappear after you buy.
It remains attached to the property.
So if you receive a 30% discount when you purchase, you’ll normally need to sell the property with the same 30% discount to another eligible buyer.
For example:
Your property’s future market value: £400,000
Required First Homes discount: 30%
Discounted resale price: £280,000
That doesn’t necessarily make the scheme unattractive.
But you need to understand what you’re buying.
I wouldn’t want someone focusing exclusively on:
“I’m getting £90,000 off!”
without understanding the resale restrictions.
What Is Shared Ownership?
Shared Ownership is another route that can help people who cannot currently afford to buy a suitable property outright.
Despite sometimes being grouped with first-time buyer schemes, it isn’t exclusively for people buying their first home.
Under the current Shared Ownership scheme in England, you typically purchase a share of a property and pay rent to a housing provider on the remainder.
Depending on the home, the initial share can generally be between 10% and 75% of the property’s market value, although the exact share available varies.
You then usually have the option to purchase additional shares later.
This is called staircasing.
Is the Shared Ownership Deposit Smaller?
Potentially.
One reason Shared Ownership can help buyers is that your deposit is generally based on the share you’re purchasing, rather than necessarily on the property’s full market value.
For example:
Full property value: £300,000
Share purchased: 25%
Cost of share: £75,000
A 10% deposit on that share would be:
£7,500
rather than £30,000, which would represent a 10% deposit on the full £300,000 property.
That’s one of the attractions.
But it isn’t the whole affordability calculation.
Shared Ownership Isn’t Simply a Cheap Mortgage
You’ll usually have several ongoing costs.
Potentially:
- Mortgage payments on the share you own.
- Rent on the share you don’t own.
- Service charges.
- Estate charges.
- Management charges.
- Insurance costs where applicable.
Rent can also increase over time.
So when I look at Shared Ownership affordability, I wouldn’t simply compare the mortgage payment with buying a normal property.
I’d want to compare the total monthly housing cost.
That’s much more useful.
Who Can Qualify for Shared Ownership?
In England, the general household income limits are currently:
£80,000 or less outside London
and
£90,000 or less in London.
You also need to be unable to afford all of the deposit and mortgage payments required to buy a suitable home outright.
There are additional eligibility requirements and some properties can have local-priority rules.
So Shared Ownership can be useful, but I wouldn’t assume that everybody earning below £80,000 automatically qualifies.
Do First-Time Buyers Get Special Mortgage Rates?
Sometimes lenders offer mortgages specifically aimed at first-time buyers.
These can include things such as:
- Cashback.
- Higher loan-to-value lending.
- Fee-free products.
- Different affordability approaches.
- Products designed for smaller deposits.
But the words:
“First-Time Buyer Mortgage”
don’t automatically mean:
“Cheapest Mortgage Available.”
A standard mortgage product could potentially offer a lower overall cost.
Whenever I’m comparing mortgages, I’d want to look at:
- Interest rate.
- Product fee.
- Cashback.
- Monthly payment.
- Overall cost.
- Early Repayment Charges.
- Affordability.
- Flexibility.
Marketing labels come after the maths.
Can My Parents Give Me My Deposit?
Potentially, yes.
A gifted deposit from parents or other family members is extremely common.
Many mortgage lenders will accept gifted deposits subject to their criteria.
The lender and solicitor will normally want to establish:
- Who is providing the money.
- Where it came from.
- Whether it’s genuinely a gift.
- Whether it needs repaying.
- Whether the person gifting it expects an interest in the property.
This is important.
If Mum and Dad say:
“Here’s £20,000, but we want it back in five years”
that’s not necessarily a straightforward gifted deposit.
It’s potentially borrowing.
Tell your mortgage adviser exactly what the arrangement is.
Don’t try to turn a loan into a “gift” because you think the lender will prefer the answer.
What If My Family Can’t Give Me a Deposit?
Don’t assume you’re locked out of buying.
Depending on your circumstances, there are mortgage products where family can potentially assist in other ways.
For example, certain lenders offer family-supported mortgage arrangements involving savings or property security.
These products have their own risks and requirements and aren’t suitable for everybody.
If family property or savings are being used as security, the family member needs to understand what could happen if mortgage payments aren’t maintained.
The right solution depends on the circumstances.
Are New-Build Developer Incentives a First-Time Buyer Benefit?
Developers sometimes offer incentives such as:
- Deposit contributions.
- Cashback.
- Paid legal fees.
- Flooring or appliance packages.
- Stamp Duty contributions.
These aren’t Government first-time buyer allowances.
They’re commercial incentives offered by the developer.
And they need to be disclosed.
Mortgage lenders can have limits on the value and type of incentives they’ll accept, and incentives may affect how the transaction is assessed.
A £10,000 “free” incentive isn’t something I’d quietly leave off the mortgage application.
The lender needs the full picture.
Are There Local First-Time Buyer Schemes?
Sometimes.
Local authorities, housing associations and developers may operate affordable-homeownership schemes in particular areas.
Eligibility could depend on factors such as:
- Local residence.
- Local employment.
- Household income.
- Property value.
- Key-worker status.
- Specific development criteria.
Availability can be extremely local.
A scheme operating five miles away may not exist in your area at all.
That’s why it’s worth checking local options when you’re planning your purchase.
Can I Combine First-Time Buyer Benefits?
Sometimes you can.
For example, depending on the rules and your circumstances, you might potentially:
- Use Lifetime ISA savings towards your deposit.
- Claim First-Time Buyers’ Stamp Duty Relief.
- Use a 95% mortgage.
- Purchase a qualifying First Home.
But don’t assume every scheme can always be combined with every other scheme or mortgage.
Each has its own criteria.
This is where planning before making an offer can be genuinely useful.
The Biggest Mistake: Assuming “Eligible” Means “Affordable”
This is something I feel strongly about.
Suppose you qualify for:
- A 5% deposit mortgage.
- Stamp Duty relief.
- A Lifetime ISA bonus.
- A Government homeownership scheme.
Wonderful.
That still doesn’t necessarily mean buying the maximum property you can possibly stretch to is a good idea.
You still have to pay for the home every month.
I’d want to consider:
- Mortgage payments.
- Council Tax.
- Energy.
- Water.
- Insurance.
- Maintenance.
- Service charges where applicable.
- Car finance.
- Childcare.
- Food.
- Lifestyle.
- Emergency savings.
And one expense people frequently underestimate:
Owning a house.
When you rent and the boiler breaks, you ring the landlord.
When you own the house, congratulations.
You are now the landlord.
Don’t Use Every Penny for the Deposit
Another mistake I see first-time buyers tempted to make is putting absolutely everything into the purchase.
Suppose you’ve saved £30,000.
You use:
£25,000 for the deposit
then the rest disappears into:
- Solicitor.
- Survey.
- Moving costs.
- Mortgage fees.
- Furniture.
Completion day arrives and your savings account contains £73 and a sense of achievement.
I’d rather consider whether you can retain an appropriate emergency fund.
Yes, increasing your deposit can potentially improve the mortgage rates available.
But financial resilience has value too.
The mortgage shouldn’t only work if absolutely nothing unexpected happens for the next five years.
Do First-Time Buyers Get Better Affordability?
Sometimes particular lenders offer products or affordability criteria designed to help eligible first-time buyers borrow more.
That doesn’t mean every first-time buyer automatically receives a larger mortgage.
Mortgage affordability still depends on factors including:
- Income.
- Financial commitments.
- Dependants.
- Loan term.
- Interest-rate stress testing.
- Credit history.
- Lender criteria.
I’ve seen first-time buyers focus heavily on whether they can borrow another £10,000 or £20,000.
The question I’d add is:
Do you actually want the monthly payment that comes with it?
The largest mortgage available isn’t necessarily the right mortgage.
What Benefits Should I Check Before Buying My First Home?
Before making serious offers, I’d want a first-time buyer to understand at least these areas:
Your first-time buyer status
Have you ever previously owned property anywhere?
Your Lifetime ISA position
Do you have one? When was the first contribution made? Is the property within the price limit?
Property tax
How much Stamp Duty, LBTT or LTT will apply?
Deposit
How much do you genuinely have available, and how much should you keep back?
Available schemes
Could First Homes, Shared Ownership or another local scheme be relevant?
Mortgage options
What can you realistically borrow and comfortably afford?
Future costs
What happens after you’ve got the keys?
That’s a much better starting point than finding a property first and trying to make everything fit afterwards.
Frequently Asked Questions
Do first-time buyers pay Stamp Duty?
Qualifying first-time buyers in England and Northern Ireland currently pay no Stamp Duty Land Tax on the first £300,000 of a qualifying purchase costing £500,000 or less. They pay 5% on the portion between £300,001 and £500,000. Different property taxes and rules apply in Scotland and Wales.
What is the maximum First-Time Buyer Stamp Duty saving?
Under the current England and Northern Ireland rules, First-Time Buyers’ Relief can reduce the Stamp Duty bill by up to £5,000 compared with the standard residential rates, depending on the purchase price and circumstances.
How much Government bonus can I get with a Lifetime ISA?
You can currently contribute up to £4,000 per tax year and receive a 25% Government bonus, meaning a maximum bonus of £1,000 each year while eligible.
Can I use a Lifetime ISA for any first home?
No. For a qualifying home purchase, the property currently needs to cost £450,000 or less and other Lifetime ISA conditions apply, including the 12-month rule.
Can I still open a Help to Buy ISA?
No. New Help to Buy ISAs are no longer available. People who already have one can currently continue saving into it until November 2029 and claim the Government bonus until November 2030, subject to the scheme rules.
Is Help to Buy still available?
The Help to Buy Equity Loan scheme is no longer open to new applications in England. Other homeownership schemes, including First Homes and Shared Ownership, remain available to eligible buyers.
Can first-time buyers buy with a 5% deposit?
Potentially, yes. 95% loan-to-value mortgages are available from participating lenders, including products supported through the permanent Mortgage Guarantee Scheme. Mortgage approval and pricing still depend on lender criteria and your circumstances.
Do first-time buyers get cheaper mortgage rates?
Not automatically. Some lenders offer products specifically designed for first-time buyers, but the most suitable or lowest-cost mortgage will depend on your deposit, borrowing, circumstances and the fees attached to the product.
Can I use a gifted deposit?
Many lenders accept gifted deposits subject to their criteria and appropriate source-of-funds checks. A genuine gift normally needs to be non-repayable, and any conditions attached to the money should be disclosed.
Can I use more than one first-time buyer scheme?
Potentially, depending on the schemes and mortgage involved. Eligibility needs to be checked individually because different schemes have different rules.
Final Thoughts
There are genuine financial advantages available to first-time buyers.
Some can save you thousands of pounds.
But I don’t think the answer is simply to collect as many schemes as possible.
The real objective is to work out which ones actually help you.
For one buyer, the biggest benefit might be £5,000 of Stamp Duty relief.
For another, it could be several years of Lifetime ISA bonuses.
Someone else might be able to buy through First Homes at a substantial discount.
Another buyer may simply need access to a 95% mortgage because the monthly payment is affordable but saving a 10% deposit would take several more years.
I’ve worked with first-time buyers who arrive thinking the biggest question is:
“How much can I borrow?”
Usually, there are better questions.
What can I comfortably afford?
What help am I entitled to?
What will buying actually cost?
How much should I keep in savings?
And which mortgage leaves me in a sensible financial position after I get the keys?
That’s where I think good mortgage advice becomes useful.
Not simply getting you through the front door.
Helping make sure the mortgage still makes sense once you’re living behind it.
If you’re planning to buy your first home and would like to understand which mortgage options and first-time buyer schemes may be relevant to your circumstances, you can book an appointment here:
https://veganmortgageadviser.co.uk/appointment
Your home may be repossessed if you do not keep up repayments on your mortgage.
First-time buyer schemes, tax reliefs and allowances are subject to eligibility requirements and can change. Mortgage availability and suitability depend on your individual circumstances, the property and lender criteria. Tax treatment depends on individual circumstances and may change. This article provides general information only and does not constitute a personal mortgage, tax, legal or investment recommendation.