Government homeownership schemes
Learn about homebuying schemes that help you get onto the property ladder
What is a government scheme?
Government schemes help prospective first-time buyers get onto the property ladder. They're usually aimed at those who might be struggling to afford the deposit that comes with buying a new home.
It’s getting more and more expensive to get on the property ladder. The average cost of a house bought by a first-time buyer in England and Wales has risen by 67% in 10 years.²
But there are many government-backed schemes to help you buy your first home.
If you're still not sure which government scheme is suitable for your situation, you can find out using our government homeownership tool.
You come up with a 5% deposit, and rather than taking out a 95% mortgage, you borrow 20% of the rest of the balance from the government. This helps you to lower your mortgage repayments.
You’re taking on two debts, but the terms of the equity loan tend to be more agreeable than a full-stack mortgage.
This scheme is due to end in 2023, but there are rumours that the government could extend it.
You can no longer open a new Help to Buy ISA. But those who already have one can continue to add to their ISA until 30 November 2029.
The Help to Buy ISA was designed to help first-time buyers struggling to save up a deposit.
Those with a Help to Buy ISA could save up to £1,200 in the first month of taking out the ISA, then up to £200 a month afterwards. The government will top it up with a 25% payment when the person is ready to buy.
The maximum amount the government will hand out is £3,000. This is a great help towards a deposit.
You can put your savings towards a home worth up to £250,000, or £450,000 if you’re buying in London.
The scheme ended on 30 November 2019, but those who applied before that date can still use their ISA.
A longer-term option is the Lifetime ISA (LISA).
With this scheme, you put up to £4,000 a year into your ISA account. The government will then add a 25% top-up, to a maximum of £1,000 a year.
There’s no limit to how much you can save over the lifetime of the offer, and you can keep on saving up to the age of 50.
There are restrictions on how and when you can withdraw your funds.
For those struggling to get a ‘traditional’ mortgage, Shared Ownership could be a good option.
You buy a share of your home - often between 25 to 75% - and borrow the money to buy it.
As well as paying back the loan, you pay rent at a reduced rate on the remaining share of your home. You can continue to buy more shares right up to the full 100% mark.
Right to Buy
Right to Buy aims to help council tenants buy the home they already live in. The scheme gives council tenants a discount towards buying the property.
Right to Acquire
Right to Acquire is for people currently renting homes from housing associations. The discount is smaller than what you get with Right to Buy.
This scheme allows you to rent a new build home from a housing association. You'll pay less than market rate rent for up to 5 years.
You have the option to offer to buy the whole property if you want to.
This is a Welsh housing scheme where the government provides an equity loan and helps you buy a property without a deposit like Help to Buy.
The scheme is for anyone unable to buy a home without help and would need social housing. It also helps those in rural communities.
There are 2 shared equity schemes in Scotland:
New Supply Shared Equity scheme
Open Market Shared Equity scheme
New Supply is for people buying new builds
Open Market is for any property on the open market that’s seen as suitable.
With both of these schemes, you buy a majority share of a house and the Scottish government will fund the rest. They'll hold onto that share unless you gradually buy it back, or until you sell the property.
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