By James Evans, Director, TouchPoint Mortgages.
Looking to buy your first home? The Government has announced plans for a new scheme designed to help first-time buyers get onto the property ladder with a smaller deposit. Here’s what we know so far and what it could mean for buyers across Southampton, Rustington, Arundel, Angmering and the surrounding areas.
Getting onto the property ladder can feel increasingly difficult for first-time buyers. Saving for a deposit, meeting mortgage affordability requirements and keeping up with house prices can make buying your first home a real challenge.
However, the Government has recently announced plans for a new initiative called the Your First Home scheme, which aims to make homeownership more accessible for people who are struggling to save a large deposit.
At TouchPoint Mortgages, we understand the challenges first-time buyers face. In this guide, we explain what has been announced, how the proposed scheme is expected to work, who it may help and what you can do now if you are hoping to buy your first home.
On 26 September 2026, the Government announced plans for a new equity loan scheme called Your First Home.
The initiative is intended to help first-time buyers purchase a new-build property with a smaller deposit than would normally be required.
The Government has indicated that the scheme is expected to allow eligible buyers to purchase a property with a deposit of just 2.5%, supported by a government-backed equity loan of up to 20% of the property’s value.
The scheme is intended to help people who may be able to afford their monthly mortgage payments but struggle to save the deposit needed to buy a property.
Further details, including the eligibility criteria, property price limits, loan terms and implementation timetable, are expected to be confirmed at the Government’s Budget on 28 October 2026.
Important: The scheme has been announced, but the final rules and application process have not yet been confirmed. Buyers should not assume they can apply immediately.
The proposed scheme is expected to combine a smaller deposit with a government-backed equity loan to help eligible first-time buyers purchase a new-build property from a participating developer.
The Government has outlined three key features.
One of the biggest barriers to buying a home is saving a sufficient deposit.
Under the proposed scheme, eligible buyers could potentially purchase a property with a deposit of just 2.5% of the purchase price.
For example, on a property costing £200,000, a 2.5% deposit would be £5,000.
For a property costing £250,000, the deposit would be £6,250.
These figures illustrate the proposed deposit requirement only and do not include legal fees, moving costs or other purchase expenses.
The scheme is expected to provide a government-backed equity loan of up to 20% of the property’s value.
This could reduce the amount a buyer needs to borrow through a conventional mortgage, potentially making the mortgage more affordable than a standard 95% mortgage.
For illustration, on a £200,000 property, a 20% equity loan would represent £40,000.
The actual mortgage amount, loan structure and amount available will depend on the final scheme rules and the buyer’s circumstances.
The Government has also indicated that the equity loan will have an initial interest-free period.
This could help reduce the overall monthly cost of buying a home, with the Government suggesting that eligible buyers could save hundreds of pounds per month compared with taking out a 95% mortgage.
However, the length of the interest-free period, the charges that may apply afterwards and the arrangements for repaying the equity loan have not yet been confirmed.
These details will be particularly important when assessing whether the scheme is suitable for an individual buyer.
The proposed scheme is aimed at first-time buyers in England who need additional help getting onto the property ladder.
The Government has indicated that eligibility will be subject to certain restrictions, including:
First-time buyer status: The initiative is designed to support people buying their first home.
A minimum deposit: Buyers are expected to need a deposit of at least 2.5%, subject to the final rules.
New-build properties: The scheme is intended for properties purchased from developers participating in the scheme.
Household income limits: A household income cap is expected to ensure support is targeted at buyers who need it most.
Local property price limits: Property price caps are also expected, although the thresholds have not yet been announced.
The Government has not yet confirmed the final income limits, regional price caps or complete eligibility requirements.
It is therefore too early to say exactly which buyers or properties in areas such as Southampton, Rustington, Arundel and Angmering will qualify.
If you are considering buying your first home, it is worth reviewing your finances and understanding your mortgage options while further details emerge.
No. This is an important distinction because the names are very similar.
The existing First Homes scheme is already available in England and is designed to help eligible first-time buyers purchase certain properties at a discount to their market value.
Under that scheme, qualifying buyers can receive a discount of at least 30%, with some properties offering larger discounts of 40% or 50%.
For example, if a qualifying property has a market value of £200,000 and is offered with a 30% discount, the purchase price would be £140,000.
The discount is attached to the property, meaning restrictions apply when the property is sold in the future. Eligibility requirements, including income limits and the need to use the property as your main residence, also apply.
The new Your First Home initiative is different. Rather than providing a discount on the property’s market value, it is intended to help eligible buyers purchase new-build homes using a smaller deposit and a government-backed equity loan.
The two schemes should not be confused, as their eligibility rules, financial arrangements and property requirements differ.
If you are a first-time buyer, it may be worth exploring whether an existing First Homes property is available in your area rather than waiting for the new initiative.
You can find the official guidance for the existing scheme on the Government’s First Homes scheme website.
For buyers looking to purchase their first home in Southampton or across West Sussex, the proposed scheme could offer another potential route onto the property ladder.
Saving a deposit can be particularly challenging when you are renting, paying household bills and trying to put money aside each month.
A smaller deposit requirement could help some buyers move forward sooner than they otherwise would.
However, the scheme is expected to apply only to participating new-build developments, and local property price caps could affect which homes are eligible.
This means the availability of suitable properties will be an important consideration.
If you are a first-time buyer looking for a property in Southampton, the proposed scheme could be worth investigating once the final rules have been published.
Whether it is suitable will depend on the availability of participating developments, your income, your deposit and the mortgage you can afford.
For buyers searching for their first home in Rustington or Angmering, the key question will be whether local new-build developments participate in the scheme and fall within the eventual price limits.
Even if the scheme is not suitable for the property you want to buy, there may be other mortgage options worth exploring.
First-time buyers looking around Arundel may also want to keep an eye on the final eligibility criteria and local property price caps.
As with any government-backed initiative, the scheme will not necessarily be suitable for every buyer or every property.
At TouchPoint Mortgages, we can help you understand your mortgage options and assess affordability based on your circumstances.
This is one of the biggest questions prospective first-time buyers may have.
The honest answer is that it depends on your circumstances.
The new scheme could be beneficial if you are struggling to save a deposit and are interested in purchasing a suitable new-build property.
However, waiting may not be the right decision for everyone.
For example:
You may already have sufficient savings to purchase a property using a conventional mortgage.
You may want to buy an existing property rather than a new-build home.
There may be no participating developments in your preferred location.
The final income or property price limits may mean you do not qualify.
Another mortgage option may be more suitable for your circumstances.
It is also important to remember that a smaller deposit does not automatically mean a cheaper mortgage or a more affordable home.
Your income, credit history, existing commitments, mortgage interest rate and the overall cost of borrowing will all play a part in determining what you can afford.
Our advice is to understand your options before making a decision. You do not necessarily need to put your homeownership plans on hold while waiting for further announcements.
Although the final details of the new scheme are still awaited, there are several practical steps you can take now.
Before viewing properties, it is worth establishing how much you may be able to borrow.
A mortgage agreement in principle can help give you an indication of your potential borrowing capacity, although it is not a mortgage offer or a guarantee that a lender will approve your application.
Work out how much you have saved and how much you could realistically put towards a property.
Remember to allow for legal fees, surveys, moving expenses and other costs associated with buying a home.
Your credit history can influence which mortgage products are available to you and how much you may be able to borrow.
Reviewing your credit profile before applying can help identify any issues that may need attention.
The new scheme is not the only possible route onto the property ladder.
Depending on your circumstances, options could include a conventional mortgage with a 5% deposit, a mortgage supported by a family member, or an eligible property purchased through the existing First Homes scheme.
The right option will depend on your personal circumstances and the mortgage products available at the time.
The Budget on 28 October 2026 is expected to provide further information about the proposed Your First Home scheme.
Once the eligibility criteria, costs and implementation timetable have been confirmed, first-time buyers will be in a better position to assess whether the scheme could work for them.
At TouchPoint Mortgages, we help first-time buyers understand their mortgage options and take the next steps towards purchasing their first home.
Whether you are looking in Southampton, Rustington, Arundel, Angmering or elsewhere in West Sussex, we can help you explore the mortgage market and understand what may be achievable based on your circumstances.
As an independent, whole-of-market mortgage adviser, we can help you compare suitable mortgage options, understand deposit requirements and prepare for the homebuying process.
We will also be keeping an eye on developments relating to the new Your First Home scheme so that we can help clients understand the published rules when further details become available.
If you are unsure whether to wait for the new scheme or explore your mortgage options now, speaking to a mortgage adviser can help you make a more informed decision.
Thinking about buying your first home?
Get in touch with TouchPoint Mortgages to discuss your circumstances and explore your options.
Visit touchpointmortgages.co.uk to find out more about our mortgage advice services.
Important information: This article reflects the Government’s announcements available on 20 October 2026. The new Your First Home scheme’s final rules, eligibility criteria, costs and launch arrangements have not yet been confirmed. Scheme availability and mortgage approval are subject to the applicable rules, lender criteria and individual circumstances.
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