By Islam El-Sakka
Chancellor of the Exchequer John Healey delivered his first Autumn Budget on Wednesday, unveiling measures aimed at helping first-time buyers onto the property ladder. The key announcements include a new First-Time Buyer ISA to replace the Lifetime ISA and the launch of the Your First Home equity loan scheme next spring.
First-Time Buyer ISA replaces Lifetime ISA
Healey announced that a First-Time Buyer ISA will replace the Lifetime ISA, addressing a penalty that currently applies when a property exceeds £450,000. Under the new arrangement, buyers will get back at least what they put in if the home costs more than the limit. The Chancellor said the move is designed to help young people who are saving for their first home.
Your First Home scheme to launch in February 2027
The Your First Home scheme, described as an equity loan programme funded by £4.7 billion of government-backed lending, will open for applications in February 2027. It targets first-time buyers who do not have parental financial support. Eligible buyers can purchase a new-build home with a deposit of at least 2.5%, a repayment mortgage from a participating lender, and a government equity loan worth 20% of the purchase price, interest-free for five years. Income caps are set at £110,000 per household outside London and £140,000 in London.
Expert reaction: deposit help but housing supply remains a concern
Ryan Etchells, chief commercial officer at mortgage lender Together, said the schemes address the deposit challenge, which is arguably the hardest part for first-time buyers. However, he noted that details on how the ISA will work were largely absent from the budget statement. Etchells added that cost-of-living measures, such as a £2.6 billion energy bills support package, may ease mortgage affordability, but external factors like the conflicts in Ukraine and Iran continue to drive inflation. On housing supply, Healey announced regulatory changes for brownfield sites, extended cheaper borrowing for councils, VAT-free land sales to social housing providers, and an additional £1.5 billion for affordable housing. Etchells said these steps do not go far enough to solve the shortage of homes.
Geographic disparities and alternative routes
Scott Clay, director of private clients at Together, highlighted a geographic disparity in the Your First Home scheme. The £110,000 income cap outside London may exclude buyers in the commuter belt who face higher house prices but miss out on London's £140,000 cap. Clay advised buyers to weigh the new-build equity loan against alternatives such as shared ownership, provided full costs are understood.
Advice for first-time buyers
Etchells recommends focusing on building a deposit first, then reviewing the new schemes when they launch to see how the government-backed loan could reduce the deposit requirement. He also advises speaking to a finance provider — whether a broker, bank, or specialist lender — to understand the property purchasing process.
