Your First Home equity loans to open in February 2027 as HBF awaits price caps

Chancellor of the Exchequer John Healey confirmed £4.7bn over five years for the Your First Home equity loan scheme in the Budget on 28 October, with the government expecting applications to open in February 2027.

The scheme offers first-time buyers of new-build homes in England a government equity loan worth 20% of the purchase price, interest free for five years, according to the GOV.UK scheme page. Buyers need a deposit of at least 2.5%.

The Home Builders Federation (HBF) welcomed the scheme but said it was still waiting for key parameters. Neil Jefferson, Chief Executive of the Home Builders Federation, said: "We welcome the Your First Home scheme to support first-time buyers of new-build homes."

He added: "A lack of effective demand has been one of the major barriers to increasing housing supply." HBF said it awaits full details on house price caps and other scheme parameters before judging the effect on investment in new homes.

The scheme

The GOV.UK scheme page says the £4.7bn is phased with £700m in 2027 to 2028 and £1bn in each subsequent year. Applications are expected to open in February 2027, with the first property sales in April 2027.

HBF's 30 October members' newsletter said the federation was encouraging the government to provide details on when the scheme would open for applications and on the outstanding regional thresholds.

Eligibility is limited to households with a total annual income of £110,000 or less outside London, or £140,000 or less within London. Property price caps will apply in each area, which the government said is to keep the scheme focused on modest homes. The scheme is for people who would struggle to buy without assistance, and the government said demand will be kept under review.

Developers will pay participation fees based on the final sale price of each home sold through the scheme. The fees are tiered by volume.

Homes sold through scheme	Developer fee
First 100 homes	1%
Next 150 homes	3%
Remaining homes	4%

OBR forecast

HBF told members that the Office for Budget Responsibility's October 2026 Economic and fiscal outlook expects net additions to the UK housing stock to fall to about 230,000 in 2025/26, and 190,000 fewer cumulative net additions over the forecast period to 2030/31 than in its March forecast.

HBF said the OBR expects the equity loan scheme to have only a marginal impact given its limited overall size. HBF also said the OBR's finding on the cumulative burden of regulation and policy costs followed the federation's Viability Crunch report earlier in 2026.

Other Budget measures

The Budget confirmed that brownfield sites up to 1.5 hectares will be exempt from Biodiversity Net Gain (BNG) requirements. Jefferson said the move would have a limited impact and benefit a relatively small number of urban sites.

The Budget also included the government's response to the consultation on the VAT treatment of land for social housing, known as Golden Brick, HBF said.

Building safety and contributions

Separately, the Ministry of Housing, Communities and Local Government announced on 27 October that building safety protections will be extended to more leaseholders, including those in collectively owned and enfranchised buildings. The government plans to raise the leaseholder protection property limit from three to six properties.

A new scheme will require construction product manufacturers to contribute to the cost of remediating unsafe buildings. The Remediation of Unsafe Cladding Bill will place a legal duty on those responsible to fix unsafe buildings, with criminal penalties and fines of up to £500,000 for those who fail to act, MHCLG said.

In Parliament, Labour MP James Naish introduced a Ten Minute Rule Bill that would require councils to spend unspent developer contributions or reallocate them where the original projects cannot be delivered, according to HBF. HBF research found more than £9bn in developer contributions held unspent by local authorities, including £6.6bn from Section 106 agreements. HBF said the total had risen by £800m, or 9%, since it last reported on the issue in mid-2024, and that Tower Hamlets alone held over £260m.

Wales

HBF Wales said Welsh Government figures show the private sector delivered 31% of all new-build affordable homes in 2025/26 through Section 106. Across Wales, 3,865 affordable homes were delivered in the year, 6% more than the previous year, of which 823 came through Section 106. HBF Wales said overall affordable delivery was the highest since records began in 2007.

Under the government's timetable, the first Your First Home property sales are expected in April 2027.