Your First Home Scheme 2026: Complete Guide for Overseas Graduates and International First-Time Buyers in the UK

What Is the Your First Home Scheme? Understanding the Government’s New Equity Loan Initiative

On 26 September 2026, the UK government formally announced a new government-backed homeownership scheme called the Your First Home Scheme, with full details to be confirmed at the Autumn Budget on 28 October 2026. This initiative follows Freedom to Buy (made permanent in July 2025) but operates on a fundamentally different mechanism.

Based on the official government announcement and analysis by Rightmove, the confirmed structure is:

• Deposit required: 2.5% of purchase price
• Government support: 20% government equity loan, interest-free during an initial period
• Mortgage required: 77.5% repayment mortgage
• Property eligibility: England only, new-build properties only, from participating developers
• Interest-free period length: To be confirmed at the October 28 Budget
• Income and property price caps: To be confirmed at the October 28 Budget

How does this differ from Freedom to Buy?

Freedom to Buy is a mortgage guarantee scheme — the government guarantees your mortgage so lenders will approve a 95% loan-to-value mortgage (5% deposit), but you carry the full market-rate mortgage repayments on the entire purchase price.

Your First Home Scheme is an equity loan scheme — the government actually lends you 20% of the purchase price. During the interest-free period, you make no payments on that 20%, significantly reducing your monthly outgoings compared to a 95% mortgage on an equivalent property.

Rightmove’s analysis illustrates the difference clearly: with a standard 5% deposit, a single buyer purchasing alone can afford a property up to approximately £216,758, requiring around £10,838 in cash. With the Your First Home Scheme’s 2.5% deposit, the same buyer’s affordable ceiling rises to approximately £265,703, with only £6,643 needed upfront — a 38% reduction in deposit requirement and a 22% expansion in accessible property values.

IREIS Properties has tracked UK government first-buyer policy closely since 2021 and will update this guide after the October 28 Budget confirms all scheme details.

Eligibility: Who Qualifies for the Your First Home Scheme?

Based on information confirmed to date, eligibility criteria include:

Confirmed requirements:

• You must be a first-time buyer globally (neither you nor any co-purchaser has ever owned residential property anywhere in the world)
• The property must be a new-build in England from a participating developer
• Household income cap and property price cap apply (specific thresholds confirmed at Budget)
• You must be purchasing with a repayment mortgage from a participating lender

Critical note for overseas graduates and international professionals

The UK defines “first-time buyer” globally. If you have ever owned — or co-owned — a residential property in any country, including China, Hong Kong, India, or your home country, you will not qualify as a first-time buyer, even if you no longer hold that property, or if it was gifted to you as a minor share.

Visa status and mortgage access

Whether the scheme will be open to non-UK nationals has not yet been confirmed. Based on how the existing market operates:

Visa Status	Typical Mortgage Access
UK Citizen or Settled Status (ILR)	Full access to mainstream lenders
Skilled Worker Visa	Many mainstream lenders, potentially with conditions
Graduate Visa (post-study)	Varies significantly by lender
Student Visa	Most mainstream lenders do not lend

If your visa status is anything other than settled or citizenship, consulting a specialist mortgage adviser before the Budget announcement is strongly recommended — so you understand your position the moment scheme details are released.

Comparing Your First Home Scheme with Existing Government Support

England currently operates several government-backed homeownership schemes simultaneously. Understanding how they differ will allow you to act quickly once Budget details are confirmed.

Scheme	Deposit Required	Government Support	Property Type
Your First Home Scheme	2.5%	20% equity loan (interest-free initial period)	New-build only
Freedom to Buy	5%	Mortgage guarantee	New-build and resale
Shared Ownership	Share-based deposit	Subsidised rent on remaining share	Housing association

Understanding the equity loan repayment obligation

The 20% equity loan under Your First Home Scheme must eventually be repaid — and critically, repayment is calculated as 20% of the property’s market value at the time of repayment, not 20% of what you originally borrowed. If your property appreciates from £300,000 to £375,000, the government’s 20% share grows from £60,000 to £75,000. This mechanism is important to understand for long-term financial planning and exit strategy discussions with your mortgage adviser.

For stamp duty (SDLT) on your purchase, the exact amount depends on whether you are a first-time buyer, an overseas buyer, and whether you already hold other property. Use our UK Stamp Duty Calculator to model your specific situation, alongside our purchase cost calculator to understand total upfront costs.

How Overseas Parents Can Support Applications Under This Scheme

Many international graduates studying or working in the UK rely on support from family based abroad. The following structures are common and legally recognised:

Gifted deposit

Parents can gift funds toward the 2.5% deposit. Most UK lenders accept a gifted deposit from a close family member, provided they receive a signed gifted deposit letter (confirming the money is a gift, not a loan) and satisfactory source-of-funds documentation. Read our guide on gifting cash or property to children in the UK for what documentation is required for funds transferred from abroad.

Joint Borrower Sole Proprietor (JBSP) mortgage

If your income alone does not support the mortgage required, a parent can join the mortgage application as a co-borrower — increasing the lender’s income assessment — without their name appearing on the property title. Whether JBSP arrangements will be permitted under Your First Home Scheme specifically will need to be confirmed with specialist brokers after the Budget. See our full overview of JBSP mortgages for overseas parents.

Deed of trust

If parents contribute beyond the deposit, a deed of trust records each party’s financial contribution and associated rights in the property. This provides legal protection for all parties in the event of future changes in circumstances.

Important: A parent’s property ownership overseas does not affect the child’s first-time buyer status, provided the child themselves has never owned property. However, if a parent is added as a joint buyer on title (not just a joint borrower), their own ownership history becomes relevant. Complex multi-party arrangements should always be reviewed by a qualified solicitor before proceeding.

Steps You Can Take Before Budget Day

The Your First Home Scheme’s full eligibility criteria, income caps, and property price caps will be confirmed at the Autumn Budget on 28 October 2026. In the meantime, the following preparation is fully actionable now:

Step one: Confirm your first-time buyer status Review your ownership history globally and document it. If there is any ambiguity — for example, a co-ownership arrangement from your home country — seek legal advice before the Budget so you are not surprised.

Step two: Understand your mortgage capacity Speak with a specialist mortgage adviser who handles overseas buyers and international graduates. Your mortgage eligibility depends on your visa type, years of UK residency, income documentation method, and credit history — all of which can be assessed independently of any government scheme.

Step three: Prepare your documentation Gather your last three months’ bank statements, your most recent P60 (if you have been employed in the UK for over a year), your last three payslips, and any source-of-funds documentation for family contributions. Having these ready means you can move quickly once the scheme launches.

Step four: Research new-build availability Browse IREIS Properties’ new-build listings to understand what properties are currently available in London and key UK cities. New-build pipelines move at their own pace — knowing the market before the scheme launches means you can act on the right opportunity when it appears.

After Budget Day on 28 October 2026, we will update this guide with the confirmed income caps, property price limits, interest-free period length, and launch timeline. If you would like to be notified when the update publishes, contact IREIS Properties on WhatsApp (+44 7925 281228) or LINE @ireis.

For a complete overview of the UK buying process, read our UK property buying process guide and visit our buying guides knowledge hub for further resources on mortgages, costs, legal structures, and investment considerations.