You’re imagining life in your new home and can’t wait to make it happen, but let’s face it, first-time homebuying can be a lot to take in. From saving for a deposit, mastering mortgage deals, and even keeping up with government schemes, it’s hard to know where to start. The good news is that in 2026, there are several options tailor-made to make it easier for first-time buyers to get on the property ladder without putting themselves at financial risk.

There are practical routes to making that first step more manageable, including shared ownership, government-backed mortgages, and savings incentives such as the Lifetime ISA. There are various rules, benefits, and potential drawbacks to each scheme, so it’s worth taking some time to determine which one suits your circumstances best.

In this guide, we will dissect the central first-time buyer schemes of 2026, explain how they work, and ultimately give you a good indication of who they are suitable for, allowing you to make that next step with confidence.

A Critical Note on Stamp Duty (2026)

Before looking at schemes, it is vital to understand the new tax rules. The temporary Stamp Duty relief expired in April 2025. In 2026, the thresholds have reverted to:

• Up to £300,000: £0 Stamp Duty for first-time buyers.
• £300,001-£500,000: You pay 5% on the portion above £300,000.
• Over £500,000: No first-time buyer relief applies; standard rates apply to the entire purchase.

Government First-Time Buyer Schemes

The government runs several different schemes to help people get on the property ladder as first-time buyers. These are built to help make home ownership easier, whether that involves reducing the amount that needs to be put down as a deposit, offering discounts or providing a saving bonus. Here are the top schemes in 2026 that you need to know about:

• Shared Ownership
• First Homes Scheme
• Mortgage Guarantee Scheme
• Lifetime ISA (LISA)

All of them work a bit differently, and the best approach for you will depend on your finances, your long-term plans, and where you would like to end up living. Let’s dive into the details.

Shared Ownership

Under Shared Ownership, you start with as much as you can buy, up to 75%, and pay rent on the rest. Essentially, you purchase a share of a property, usually somewhere between 10 and 75%, and you pay rent on the share that you do not own. Over time, you can buy more and more of your property through a process known as “staircasing,” until you own the property outright if you so wish.

Pros:

The main advantage of Shared Ownership is the lower deposit. Because you’re purchasing only part of the property upfront, your upfront costs are much lower. There’s also the option to gradually increase your ownership, which can help with budgeting for outgoing expenses every month.

Cons:

You should also remember that your monthly costs will be made up of mortgage repayments on the share you own and rent on the share you don’t own. Some shared ownership properties also come with restrictions on resale, so it may take longer to sell or be more complicated than for a regular home.

Who it suits:

Shared Ownership is perfect for families or individuals who won’t get a large mortgage or who can’t afford a large deposit. It’s beneficial if you would be comfortable borrowing enough to be able to afford 50% of a property, but would struggle if buying the whole property. Monthly payments are generally cheaper than buying outright, so it’s an affordable option to get on to the property ladder.

First Homes Scheme

The First Homes Scheme is designed to give local first-time buyers a discount on newly-built homes. The properties are sold with a minmum 30% discount off the market value, meaning you have a 30% equity from the second you move in.

Eligibility:

To qualify for the scheme, typically, you have to be a first-time buyer, subject to local income caps. The price of the property is also capped, at a level that depends on location. The scheme is designed to favour local buyers, allowing communities to retain residents who might otherwise be priced out.

Benefits:

The most significant benefit is the instant equity you accumulate. Get in on buying a home at a reduced price since your property is already worth more than you paid on your first day. It’s an excellent step onto the ladder, particularly in places where property prices are high.

Limitations:

There may be limited availability, and the scheme is also region-specific; not every town or city will have First Homes available. It’s mostly for new-build homes, so that you won’t see much on the resale market under this scheme. But if you qualify and the property is in the right place, it remains a good choice for first-time buyers.

Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme, made permanent in July 2025 and often referred to as the “Freedom to Buy” scheme, is an essential offer to those with lower deposits. It offers mortgages at a 95% loan-to-value (LTV) ratio, which means you can purchase a property with as little as a 5% deposit. The government gives a guarantee to the lender to cover some of the lender’s losses if the borrower defaults, and only mortgages between 91% and 95% LTV have the support.

Eligibility:

It is open to first-time buyers as well as home movers.

Benefits:

The main benefit is obvious: a lower deposit requirement. It gives lenders an incentive to continue selling high-LTV mortgages, and can make a significant difference if you haven’t been able to build up a substantial deposit. It also gives you more choice if you’re buying a home in a tight market.

Considerations:

Though the scheme clears the way to the ladder, affordability checks remain stringent. You’ll have to prove you can afford the monthly repayments, which could be higher than on loans with a larger deposit. And bigger deposits still usually mean better interest rates. It all adds up in the end, and this scheme offers a long-term, government-guaranteed route for home buyers with little to put down, as well as providing a secure environment for mortgage lenders.

Lifetime ISA (LISA)

A LISA is a savings account for first-time buyers that helps them save towards a deposit more quickly. You can save up to £4,000 a year at any time, and the government adds a 25 per cent bonus, up to £1,000 free money per year.

Using a LISA for a first home:

You can use money in a LISA to buy your first home, so long as it is worth £450,000 or less. The bonus can give you a significant lift in the effort to save for a house and can mean the difference when you apply for a mortgage.

Pros:

Here, the free money comes from the government. A LISA is also flexible, so you can save for up to 50, and if you don’t buy your first home straight away, you can continue saving.

Cons:

There are some restrictions. You can use the money only for your first home, or a withdrawal penalty applies. Additionally, the property value limit suggests that if you’re house hunting in a high-value market, you might need more savings on hand to pay the entire amount.

A Lifetime ISA is an easy and low-risk way to receive a little extra help with your deposit. It could also have a significant impact on lowering upfront prices when combined with other government incentives.

Choosing the Right Scheme

With so many choices, it can be overwhelming to know where to begin. The correct answer depends on several factors, such as the size of your down payment, your income, your plans, and where you want to live.

• If you want to pay less a month, but cannot afford a high initial lump sum, shared ownership could be the ideal solution.
• The First Homes Scheme is designed for buyers who prefer a discounted home and meet local criteria, such as those in high-demand areas.
• If you have a small deposit but can afford larger monthly repayments, you may find that the Mortgage Guarantee Scheme is best for you.
• A lifetime ISA enhances these by adding a government bonus to your savings, getting you to your deposit faster.

Schemes should be carefully compared against one another. Each has its pros and cons, and what’s ideal for one person might not work for another. Professional guidance can be priceless; a mortgage adviser or broker can explain your options, work out the likely costs, and prevent you from making mistakes that will prove to be expensive further down the line.

Your Next Steps as a First-Time Buyer in 2026

2026 offers first-time buyers a range of government-backed schemes to help them access the property ladder at a lower cost. From Shared Ownership and the First Homes Scheme, to high-LTV mortgages under the Mortgage Guarantee Scheme, to savings contributions via the Lifetime ISA, there is something in there for almost every scenario. 

There are pros and cons to both, but the question is really what best aligns with your finances and future plans. It is recommended that relevant professional advice be sought to assist with the numerous decisions that need to be made and to ensure that the option you adopt is the right one for you. If you’re considering buying your first home, Mortgaged can guide you through the process and help you take your next step onto the property ladder with confidence.

Your home/property may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.

There may be a fee for mortgage advice. The precise amount will depend upon your circumstances and will be agreed with you before proceeding, but we estimate it will be £395.

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