First-time buyer benefits 2026: what each perk is worth

What first-time buyer benefits are there in 2026?

First-time buyers in England get seven kinds of help in 2026. Two are tax and savings perks: stamp duty relief (worth up to £5,000) and the Lifetime ISA bonus (up to £1,000 a year each). Four are schemes: the Your First Home equity loan announced on 26 September 2026, First Homes discounts of 30% to 50%, Shared Ownership, and 95% mortgages backed by the government’s mortgage guarantee scheme. The seventh is mortgage deals that lenders keep for first-time buyers. Some are worth thousands of pounds; others are a door open to you and closed to everyone else.

How much does first-time buyer stamp duty relief save?

Up to £5,000. First-time buyers pay no stamp duty on the first £300,000 of a home costing £500,000 or less, and 5% on the part from £300,001 to £500,000 (GOV.UK). Everyone else pays 2% on the slice from £125,001 to £250,000 and 5% above that, so on a £300,000 home a first-time buyer saves the full £5,000 a mover would pay. On £350,000 you pay £2,500 instead of £7,500; on £500,000, £10,000 instead of £15,000. Above £500,000 the relief disappears completely.

Two conditions catch people out. Everyone buying must be a first-time buyer, and you must intend to live in the home as your main residence (GOV.UK). A first-time buyer here means someone who has never owned a home or a share of one anywhere in the world, including by inheritance. The stamp duty page has the calculator and the worked examples.

What is the Lifetime ISA bonus worth?

Up to £1,000 a year per person. The government adds 25% to whatever you pay into a Lifetime ISA, on up to £4,000 a year, as long as you make your first payment before you are 40; you can keep paying in until you are 50 (GOV.UK). Save the full £4,000 a year for three years and you have £12,000 plus a £3,000 bonus, plus any interest or growth.

One change coming: HM Treasury consulted in summer 2026 on a First-Time Buyer ISA to be offered “in place of the Lifetime ISA” once it exists; existing accounts carry on and the new terms are not yet set (GOV.UK). The strings today: the home must cost £450,000 or less, you must buy with a mortgage, you must use a conveyancer, and the account must have been open at least 12 months before you buy. Take the money out for anything other than a first home or retirement and you pay a 25% withdrawal charge, which takes back the bonus and a little more (GOV.UK). If you are buying with someone who also has a Lifetime ISA, you can both use your savings and bonus on the same home.

What will Your First Home offer?

A 2.5% deposit and a 20% government equity loan on a new-build home in England, for first-time buyers only, with an initial interest-free period (GOV.UK). An equity loan means the government owns 20% of your home’s value until you repay it, so we expect you to repay 20% of what the home is worth at the time, not the sum you borrowed, as with Help to Buy; the repayment rules are still to be published.

On the £230,000 starter-home example used in reports of the announcement, the deposit falls from £11,500 at 5% to £5,750, and because the mortgage covers 77.5% of the price instead of 95%, our calculator puts the monthly payment at about £1,042 against £1,348 for a 95% mortgage at the best September 2026 rates. There will be a household income cap and local price caps, both still to be set. Everything about interest after the free period, and about repayment, is an assumption based on Help to Buy until the Budget on 28 October 2026. Start at the scheme explained and eligibility.

What is the First Homes discount?

First Homes are new-build homes, or resales of earlier First Homes, sold to first-time buyers at 30% to 50% below market value, and the discount stays on the home for every future sale (GOV.UK). Councils must require at least 30% and can insist on 40% or 50%; after the discount the first sale price can be no more than £250,000, or £420,000 in Greater London (GOV.UK).

To qualify you must be 18 or over, a first-time buyer, earning no more than £80,000 a year before tax (£90,000 in London) as a household, and able to get a mortgage for at least half the discounted price (GOV.UK). A £300,000 home at a 30% discount costs £210,000. Councils can give priority to key workers and local people for the first three months a home is on sale. The comparison sets it against Your First Home.

Can first-time buyers use Shared Ownership?

Yes. Being a first-time buyer is one of the qualifying routes into Shared Ownership, alongside people who used to own and cannot afford to now, and existing shared owners moving on (GOV.UK). Your household income must be £80,000 a year or less, or £90,000 in London, and you must be unable to afford all of the deposit and mortgage for a suitable home on the open market.

You buy a share, usually between 25% and 75% of the home and as little as 10% on some homes, and pay rent on the rest (GOV.UK). The deposit is a percentage of the share, not the whole price, which is why the up-front cost is so much lower. The Shared Ownership guide and eligibility page cover the rent, the service charge and the trade-offs.

What does the mortgage guarantee scheme do?

It keeps 95% mortgages available. Since July 2025 the government has permanently guaranteed part of lenders’ losses on mortgages of 91% to 95% of the price, so that first-time buyers and movers can buy with a 5% deposit (GOV.UK). You do not apply for it; your lender does. The scheme covers repayment mortgages on homes you will live in, and its rules exclude buy-to-let, interest-only and any purchase “as part of a shared ownership or shared equity scheme” (GOV.UK).

The benefit is availability, not price. On 26 September 2026 the best 95% two-year fix was 5.57% against 5.13% at 90% from lenders operating across England (HomeOwners Alliance). The 5% deposit comparison shows what that gap costs each month.

Which lender deals are only for first-time buyers?

Some lenders sell products that only first-time buyers can have. Two kinds exist, described here in general terms; we do not recommend lenders or products, and the terms change often.

• Borrowing boosts. Some lenders let first-time buyers borrow more than their usual income multiple (up to about six times income in some cases), usually on longer fixed rates, with at least a 5% deposit and extra conditions such as not being self-employed.
• No-deposit mortgages for renters. A few lenders offer 100% mortgages to people with a clean record of paying rent on time for at least a year and no recent home ownership, sometimes with a price limit and restrictions on flats.

Bigger borrowing means bigger repayments, and a 100% mortgage leaves you owing more than the home is worth if prices dip. Compare the whole deal, including fees, with a regulated mortgage adviser; the new build mortgages guide covers the extra rules on new homes.

Can you combine the benefits?

Mostly, yes. Stamp duty relief and the Lifetime ISA depend only on you being a first-time buyer, so they sit alongside any scheme. First Homes prices are capped at £250,000 (£420,000 in London), comfortably under the Lifetime ISA’s £450,000 limit. The one hard clash is the mortgage guarantee scheme, whose rules exclude shared ownership and shared equity purchases, so it cannot back a Shared Ownership or equity loan mortgage. Whether Your First Home price caps will fall under the Lifetime ISA’s £450,000 limit everywhere is one of the details the Budget will settle.

Worked example: a couple buying a £300,000 new build

Two first-time buyers each save £4,000 a year in a Lifetime ISA for three years: £24,000 saved plus £6,000 of government bonus gives £30,000 before interest. They pay no stamp duty, saving the £5,000 a mover would owe. If they use Your First Home under the expected rules, the deposit is £7,500 and the mortgage £232,500; at the calculator’s default rates that is about £1,359 a month against £1,759 for a 95% mortgage on the same home, a saving of about £400 a month while the equity loan is interest-free (calculator). Their spare £22,500 could go on a bigger deposit or the fees.

What to do next

• Check the stamp duty calculator for your price, and confirm everyone buying counts as a first-time buyer.
• If you are under 40 and more than a year from buying, a Lifetime ISA still pays its 25% bonus and starts the 12-month clock, but read the comparison page first: the Treasury plans a First-Time Buyer ISA to replace it for new savers, and its terms are not yet set.
• Run your numbers through the Your First Home scheme calculator, then read eligibility once the Budget sets the caps on 28 October 2026.
• Compare every scheme in one place on the comparison page.