The new Help to Buy scheme could push house prices up a little if it behaves like the last one did in the area an official study measured, but the evidence on the scale is mixed and the terms that decide it are not yet published.
On 26 September 2026 the government announced Your First Home, an equity loan scheme in England, widely described as a revived Help to Buy, that is expected to let first-time buyers purchase a new build with a 2.5% deposit, backed by a 20% government equity loan.
The last scheme of this kind was measured in an official evaluation published on 15 September 2026, which compared English homes within 10 km of one border with similar homes just across it, where the English scheme did not apply.
It estimated that from 2013 to 2021 prices of homes in those border areas were around 2% higher than they would otherwise have been. It described that as a relatively small effect, and said the evidence on the precise scale of the effect in any given area was mixed.
It did not rule out larger effects elsewhere in England: separate analysis of new build prices found bigger rises in areas that were already expensive, and a wider national comparison showed a larger gap in prices that the evaluation said it could not confidently attribute to the scheme.
Your First Home is announced, to be confirmed at the Budget, and not yet in operation. The government says the income cap and local price caps will be set out at the Budget on 28 October 2026, along with further details including costs and implementation timelines. It has not said how long the interest-free period will last. Until then, anyone deciding whether to sell, buy or wait is working from the headline terms and from what happened last time.
In short
- Your First Home is expected to offer a 2.5% deposit and a 20% government equity loan, for first-time buyers of new builds in England only.
- Income caps, local price caps, costs and implementation timelines are due at the Budget on 28 October 2026. The interest-free period has not been published.
- An official evaluation estimated the old scheme left prices of homes overall in the border area it studied about 2% higher from 2013 to 2021, a relatively small effect.
- In the evaluation’s survey, 54% of Help to Buy customers were classed as able to have bought without it, based on their own survey answers.
- For a seller, last time’s estimated effect near the border was small on average, but it varied by area and the new terms differ. In our view, mortgage rates are likely to matter more this winter.
What the new scheme offers
According to the government’s announcement, the scheme is expected to support 2.5% deposits for first-time buyers purchasing a new build from a developer that has signed up. A government-backed equity loan of 20% of the price sits alongside the deposit, and that loan will start with an interest-free period. Developers will be expected to pay a contribution to join.
The split on a new build priced at £250,000 would look like this:
| Part of the price | Share | On £250,000 |
|---|---|---|
| Buyer’s deposit | 2.5% | £6,250 |
| Government equity loan | 20% | £50,000 |
| Mortgage | 77.5% | £193,750 |
A buyer on a standard 95% mortgage would need a £12,500 deposit and would borrow £237,500 from a lender on the same home. That gap is the scheme’s selling point. The government says users could save hundreds of pounds a month compared with a 95% mortgage, although that depends on terms not yet published.
Much of what decides whether it works is still unknown. The household income cap and the local property price caps will limit who can use it and what they can buy. Nobody knows yet how long the loan stays interest free or what it costs afterwards.
Under the old scheme the loan was interest free for five years and was repaid as the same share of the home’s value at the time of repayment, so a rise in value raised the amount owed. Press reports, including the Guardian’s, say a registration process, which some outlets call pre-registration, is expected to open by the end of 2026, while the government’s own release leaves implementation timelines to the Budget.
Where it applies: the announcement covers England only, and new builds only. A second-hand flat or house cannot be bought through it, and it is not yet clear whether the devolved governments will offer their own versions.
What Help to Buy did to prices
Help to Buy ran in England from 2013 to 2023. It offered an equity loan of up to 20% on new builds, raised to 40% in London from February 2016, and was restricted to first-time buyers with regional price caps from 2021.
The evaluation, commissioned by the Ministry of Housing, Communities and Local Government and carried out by Verian, Sheffield Hallam University and Alma Economics, used that border comparison to separate the scheme’s effect from the wider market.
Three findings matter for anyone pricing a home. First, the rise was not confined to new builds: the evaluation concluded that the scheme likely contributed to slightly higher prices across all homes. At the border, the estimate for all homes taken together was clear, while for new builds on their own it found no strong evidence of an effect.
Second, the effect was uneven. Where deposits were already high before the scheme, new build prices rose most and first-time buyer numbers barely moved, which suggests the extra borrowing power there may have gone into the price.
Third, buyers paid a small extra premium for the scheme itself. The evaluation found new builds sold at about 5% more than similar second-hand homes, and about 6% when bought through Help to Buy.
There is a stronger reading of the price effect. A study by Carozzi and others, published in 2024, estimated that raising the London loan to 40% in 2016 pushed new build prices in the capital up by about 8%.
The evaluation’s own first analysis found little effect, and a rerun using the earlier study’s data-matching method gave about 5%, with a margin of error that included zero. It called the size of the effect inconclusive and tentatively judged about 2% for London new builds the most plausible result.
For the border result, the evaluation gives its own example of the scale: a home bought for £200,000 would have cost around £196,000 without the scheme.
Why 2026 is not 2013
The evaluation itself warns against reading the past straight across. Help to Buy launched into a market still depressed after the financial crisis, with Bank Rate at 0.5%, and its effect on building was clearest in the first years. By the time the scheme changed in 2021, it found little further effect on supply, partly because 95% mortgages had become easier to get without it.
Today Bank Rate is 3.75%, after the Bank of England held it on 17 September with three of nine members voting for a rise. An equity loan shrinks the mortgage, but the buyer still pays today’s rate on the 77.5% that remains. The scheme will also compete with 95% mortgages that already exist, which may limit how many extra buyers it creates.
In our view, the market’s first reaction suggests investors expect housebuilders to gain most. Persimmon shares closed about 15% higher and Barratt Redrow about 12% higher on 28 September, according to press reports. Developers will also pay to join, and how that cost will be treated in pricing is not yet known.
Selling a second-hand starter home
The obvious worry for anyone selling a flat or small house is that first-time buyers will be pulled towards new builds, leaving fewer for second-hand stock.
The evaluation did not measure the effect on second-hand sales directly, although 49% of Help to Buy customers surveyed said the scheme completely affected their decision to buy a new build. What it did find is that the scheme likely contributed to slightly higher prices across all homes, not only the ones it could buy, and that near the border it studied the estimated effect was small.
That makes waiting for the scheme a weak reason to delay a sale. The terms are not set, the start date is not confirmed, and the last scheme’s estimated effect was about 2% near the border. The new terms differ, and the 2013 to 2021 version was open to existing homeowners as well as first-time buyers, so its effect this time is unknown.
Borrowing costs are likely to move your buyer’s budget more, and fixed mortgage rates have been rising since the summer. If you are weighing it up, our guide to selling now or waiting until 2027 runs through the forecasts.
Price your home against today’s buyers and today’s rates, not against a scheme that has no start date.
What this means for property investors
Investors probably cannot use it. Your First Home is for first-time buyers, and the old scheme was for a buyer’s main home, so it is unlikely to help a buy to let purchase, though the full rules are not yet published. It is likely to add competition for starter new builds in the areas and price bands it covers.
Watch the new build premium. A scheme buyer on the old terms paid about 6% more than for a similar second-hand home. In our view, that extra pays for being new, and the next buyer gets a second-hand home. Our guide to where the new build premium is worth paying sets out the regional numbers.
Check the caps on 28 October. The local price caps will decide which towns and price bands see extra demand. The evaluation found the old scheme did most for first-time buyer numbers in areas that were already affordable.
If you own a starter home or a rental and are deciding whether to sell before or after the scheme arrives, get a free desktop valuation: an evidence-backed range, normally within 24 hours, yours whether you sell or not. If you are buying, browse our current listings or join the insider list for off-market deals before they are advertised.
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