If you’re a first-time buyer in the UK looking for an affordable way to get on the property ladder, you’ve likely come across two major government schemes: the First Home Scheme and Help to Buy scheme.
While both were introduced to support first-time buyers, they offer very different benefits—and in 2025, one is still running while the other has closed to new applicants.
In this guide, we break down the key differences between the First Home Scheme vs Help to Buy, including eligibility, discount/loan types, repayment terms, and which one is more suitable for buyers in today’s market.
🏠 What is the First Home Scheme?
Launched in June 2021, the First Home Scheme is a UK government initiative designed to offer discounted homes to first-time buyers and key workers. The scheme provides:
- A minimum 30% discount on market price (up to 50% in some areas)
- Exclusively available on new build properties
- Aimed at helping local residents and essential workers stay in their communities
Once a buyer purchases a property under this scheme, the discount is locked into the property.
This means that when the owner decides to sell in the future, they must pass on the same percentage discount to the next buyer, ensuring long-term affordability.
✅ Key Features:
- Minimum 30% discount, maximum 50% based on local authority
- Buyers must be first-time buyers
- Annual income must not exceed £80,000 (£90,000 in London)
- Local connection requirements (set by the council)
- Applies to new builds only
- Maximum price after discount: £250,000 outside London, £420,000 in London
💷 What Was the Help to Buy Scheme?
The Help to Buy Equity Loan was one of the most popular schemes in the UK from 2013 to 2023. It allowed first-time buyers to purchase a new build home with:
- Just a 5% deposit
- A government equity loan of up to 20% of the property value (40% in London)
- The loan was interest-free for the first five years
However, the scheme closed to new applicants in March 2023, although thousands of buyers are still repaying their Help to Buy equity loans.
✅ Key Features:
- Only available for new builds
- Maximum purchase price: region-dependent
- 5% buyer deposit required
- Repayment begins with interest after year 5
- Available nationwide, no local priority
- Loan is repayable when the home is sold or remortgaged
📊 First Home Scheme vs Help to Buy Comparison Table
| Feature | First Home Scheme | Help to Buy Scheme |
| Availability | Open (2025) | Closed (March 2023) |
| Discount/Loan Type | 30%-50% discount | 20%-40% equity loan |
| Property Type | New builds only | New builds only |
| Buyer Type | First-time buyers & key workers | First-time buyers only |
| Income Cap | £80,000 (£90,000 in London) | No income cap |
| Deposit Required | Yes (mortgage-based, varies) | Minimum 5% |
| Repayment | Discount applied; no repayment needed | Loan repayment + interest (after 5 yrs) |
| Local Restrictions | Yes (set by council) | No |
| Ownership Restrictions | Must resell with same discount | None |
🎯 Who Is Eligible for Each Scheme?
✅ First Home Scheme:
- Must be a first-time buyer
- Income must not exceed £80,000 outside London or £90,000 in London
- May be required to live or work locally
- Priority often given to key workers (nurses, teachers, etc.)
- Cannot own any other property, now or in the past
✅ Help to Buy (before 2023 closure):
- Must be a first-time buyer
- Must purchase a new build home
- Must be able to afford a 5% deposit
- Not income-restricted
- No other property ownership
✅ Pros and Cons of the First Home Scheme
✔️ Pros:
- Huge upfront discount (30%–50%)
- No loan to repay
- Focused on local buyers and essential workers
- Makes homes more affordable for low-income buyers
❌ Cons:
- Resale restrictions (must sell with the same discount)
- Not widely available in every area
- New builds only
- May not suit buyers looking for long-term property investment
✅ Pros and Cons of the Help to Buy Scheme
✔️ Pros:
- Low deposit requirement (just 5%)
- Allowed buyers to purchase more expensive homes
- Helped over 350,000 people onto the property ladder
❌ Cons:
- Loan repayments begin after 5 years (plus interest)
- Closed to new applicants as of 2023
- Only applicable to new builds
- Many buyers now struggle with repayment burden
🧐 Which Scheme Is Better in 2025?
💡 The Verdict:
As of 2025, Help to Buy is no longer an option for new buyers, while the First Home Scheme remains fully operational and is actively expanding across more UK regions.
So, if you’re a first-time buyer in 2025:
- The First Home Scheme is your best bet if you’re looking for long-term affordability, especially if you’re a key worker or meet local criteria.
- If you previously used Help to Buy, be prepared to manage loan repayments, particularly with rising interest rates.
The First Home Scheme’s non-repayable discount is ideal for buyers who want a lower monthly mortgage and don’t mind resale restrictions. It also supports community stability by keeping essential workers near their workplaces.
❓ FAQs
1. What is the difference between Help to Buy and the First Home Scheme?
Help to Buy offered a government equity loan (repayable), while the First Home Scheme offers a permanent discount (non-repayable).
2. Can I apply for both schemes?
No. Help to Buy is closed. First Home Scheme is the current active option.
3. Is Help to Buy still available in 2025?
Not for new buyers. Existing users must continue to repay the equity loan.
4. Are resale restrictions a problem in the First Home Scheme?
Only if you’re looking for capital gains. You’ll have to resell the home at the same discount.
5. Can I get a mortgage with the First Home Scheme?
Yes. Most lenders support the scheme, and you’ll require a standard mortgage for the discounted price.
🏁 Conclusion
When choosing between the First Home Scheme and Help to Buy, it’s clear that the First Home Scheme is the go-to choice for new buyers in 2025.
While Help to Buy opened the doors for hundreds of thousands of homeowners, its closure means today’s buyers need to focus on newer, more community-focused options like First Home.
If you’re eligible and meet local requirements, the First Home Scheme offers a powerful, debt-free route to homeownership—with a government-backed discount that’s hard to beat.