First Homes Scheme Calculator

The First Homes scheme offers first-time buyers in England a minimum 30% discount on new-build homes, with some local authorities offering up to 50% off. The discount is funded by the developer and set through Section 106 planning agreements. After the discount, the home must cost no more than £250,000 (or £420,000 in London). The scheme launched in 2021 and is available on participating new-build developments and on resales of existing First Homes, so the first task is finding a development near you with First Homes plots.

Eligibility requirements include being a first-time buyer, a household income of not more than £80,000 (£90,000 in London), and securing a mortgage for at least 50% of the discounted price. Local connection and key worker status may be prioritised. The discount is written into the property title, so the same percentage discount normally passes to the next buyer when you sell. That restriction is the heart of the scheme: the home stays affordable for the next buyer, but it also limits how much capital gain you can ever take out of it.

This calculator shows the purchase price after the discount, compares it with the market value, checks the national price, income and 50% mortgage criteria (with a London option), estimates your monthly payment at the mortgage rate and term you enter, and works out the stamp duty on the discounted price with first-time buyer relief (nothing up to £300,000, then 5% up to £500,000). It also projects a resale after the number of years you choose at an assumed house price growth rate, showing the First Homes sale price at the same percentage discount and your equity after repaying the remaining mortgage.

A sample makes the pricing clear. On a home with an open market value of £280,000, a 30% discount means you buy at £196,000 and save £84,000 upfront. The mortgage is taken only on the discounted price of £196,000, not the market value, which makes the affordability test easier to pass. A deposit is still typically 5-10% of the discounted price, so £10k-£20k rather than the £14k-£28k the market price would demand. When you sell, the 30% discount normally applies to the new market value, so if the home is then worth £350,000 you can sell for no more than £245,000.

First Homes launched in 2021 as a separate scheme, not as a replacement for Help to Buy, whose equity loan in England closed to new applications on 31 October 2022. It differs from Shared Ownership, where you buy a 25-75% share and pay rent on the remainder, because you own 100% of the home at a discount. A Lifetime ISA can still be used alongside it, adding a 25% government bonus on up to £4,000 a year, worth £1,000 a year towards the deposit. First-time buyers pay no SDLT below £300,000, a threshold that reverted from the temporary £425,000 on 1 April 2025. The Mortgage Guarantee Scheme, under which the government underwrites 95% LTV mortgages, is separate from First Homes.

Each council sets its own local rules on top of the national criteria. Common requirements include living or working in the local authority area for 3 or more years, being a key worker (NHS, teacher, police or armed forces) or being on the housing waiting list. For the first 3 months a development's First Homes are typically available only to local residents, after which they open to a wider area. London boroughs often apply higher discounts of 40-50%, and rural exceptions allow smaller Section 106 developments in villages. Supply is patchier than it was: national planning policy stopped requiring 25% of affordable homes on new developments to be First Homes in December 2024, so councils now decide whether to ask for them. On 26 September 2026 the government also announced a new equity loan scheme, Your First Home, for first-time buyers of new-build homes, with details due at the Budget.

The restricted resale is the main drawback, since you normally have to sell to an eligible buyer at the original percentage discount and your capital gain is capped accordingly. If a First Homes sale fails after 6 months of marketing, or would cause severe hardship, the council can let you sell on the open market, but you then repay the same percentage of the sale price to the council. Lenders accepting First Homes include Halifax, Barclays, Nationwide and Skipton, but choice is narrower than on the full-price market. Letting is usually restricted, as the home must be your primary residence. Service charges on flats are the same as on full-price flats and can run £2-£5k a year. It pays to research the developer through NHBC reviews and Trustpilot before committing. The scheme is strong for first-time buyers without family help, and less attractive if you expect to move within 5 years.