If you are trying to buy your first home, you may be looking for a way to stay close to the area you already know. That might be near work, family, schools, childcare, transport links or the community you already feel part of.
For many first-time buyers, buying in the place they want to live can be difficult. Saving for a deposit takes time, mortgage affordability can be tight, and homes in popular areas may feel out of reach. The First Homes scheme was created to help some buyers bridge that gap.
The First Homes scheme offers selected homes at a discount of 30% to 50% below market value. It is only available in England and is aimed at eligible first-time buyers who plan to live in the property as their main home. You can read the full government rules in the official First Homes scheme on GOV.UK.
The First Homes scheme is a government-backed affordable home ownership scheme for first-time buyers in England. It allows eligible buyers to purchase selected homes for less than their full market value.
The discount is at least 30%, although some councils may set a higher discount of 40% or 50% where local affordability is more stretched.
The discount stays attached to the property. When you sell, the same percentage discount must usually be passed on to the next eligible First Homes buyer. This helps keep the home more affordable for future buyers too.
In simple terms:
- You buy 100% of the home
- You pay a discounted price
- You must meet the scheme rules
- You must live in the home as your only or main residence
- You pass on the same percentage discount when you sell
This is different from Shared Ownership, where you buy a share of the home and usually pay rent on the remaining share.
Guinness Homes is proud to provide award-winning Shared Ownership and private sale homes in areas you want to live.
How the First Homes discount works
The First Homes discount is applied to the market value of the property.
For example, if a home has a market value of £300,000 and is sold with a 30% First Homes discount, the eligible buyer would pay £210,000.
That lower purchase price can help in three main ways:
- You may need a smaller deposit
- You may need a smaller mortgage
- Your monthly mortgage payments may be lower than buying the same home at full market value
The discount also applies when you sell. If you bought with a 30% discount, you must usually sell with a 30% discount. If the home is valued at £350,000 in the future, it would be sold to the next eligible buyer for £245,000.
You may still benefit if the home rises in value, but your sale price will reflect the First Homes discount. This is one of the main points to understand before you apply.
Main features of the First Homes scheme
The First Homes scheme has national rules, with extra local rules in some council areas.
The main features include:
- Discount: At least 30% below market value, with some councils able to require 40% or 50%
- Location: Only available in England
- Buyer type: Aimed at first-time buyers
- Ownership: You buy 100% of the property
- Property use: The home must be your only or main residence
- Mortgage: You usually need a mortgage for at least 50% of the discounted purchase price
- First sale price cap: After the discount has been applied, the first sale must be no more than £250,000, or £420,000 in Greater London
- Resale: The same percentage discount must usually be passed on when you sell
- Property type: New-build homes from developers, plus some resales from previous First Homes buyers
The £250,000 and £420,000 price caps apply to the first sale only, not to every later resale. Later resale prices are based on the market value at the time of sale, minus the same percentage discount.
You should always check the latest official rules on GOV.UK’s First Homes scheme guide before applying.
Who is eligible for the First Homes scheme?
To buy through the First Homes scheme, you need to meet the national eligibility rules. Local councils can also add their own criteria, so the rules can vary from one area to another.
You will usually need to:
- Be aged 18 or over
- Be a first-time buyer
- Buy the home as your only or main residence
- Be able to get a mortgage for at least 50% of the discounted purchase price
- Have a household income of no more than £80,000 a year before tax, or £90,000 a year before tax if buying in London
If you are buying with another person, everyone buying the home must be a first-time buyer. Your combined household income must also stay within the income cap.
Before you reserve a home, check:
- National rules: Confirm you meet the First Homes eligibility requirements
- Local council policy: Check whether the council has extra conditions
- Development criteria: Ask whether the site has specific application rules
- Mortgage position: Make sure your lender accepts First Homes applications
You can find the relevant council through the official find your local council service.
What counts as a first-time buyer?
For the First Homes scheme, a first-time buyer is normally someone who has never owned a residential property before. If you are buying with another person, they must also be a first-time buyer.
That includes property:
- In the UK
- Abroad
- Bought alone
- Bought jointly with someone else
- Inherited or received as a gift, where ownership applied
If one of the buyers has owned a home before, you are unlikely to qualify. This is one of the first checks to make before you spend time on applications, mortgage advice or legal fees.
Local connection and priority rules
Councils can set local rules for First Homes properties in their area. These rules are designed to help homes go to people with a link to the local community.
A council may give priority to buyers who:
- Already live in the area
- Work in the area
- Have close family nearby
- Work in council-defined public-service roles
- Have a household income below a local threshold
These rules are set locally, so you should not assume that the policy in one council area will be the same in another.
Local priority rules usually apply for the first three months that a First Homes property is on sale. If no eligible buyer is found during that period, the home may be opened up to a wider group, as long as the buyer still meets the national scheme rules.
Armed Forces applicants and some family members may be exempt from local connection or public-service worker criteria. This can apply to serving members of the Armed Forces, some former spouses or civil partners, some bereaved partners, and veterans who left the Armed Forces in the last five years.
Who gets priority for First Homes?
Because First Homes properties are limited, demand can be high. Priority is usually shaped by the local council’s policy and the details of the development.
Priority may be given to:
- First-time buyers who meet the national criteria
- People with a local connection
- People working locally
- People in council-defined public-service roles
- Buyers with family ties in the area
- Eligible Armed Forces applicants
The council may also set its own income limits or define which jobs receive local priority.
Before you apply, ask the developer for:
- Eligibility policy: The local authority rules for that development
- Application form: The form you need to complete and submit
- Evidence list: Proof of income, identity, deposit and local connection
- Priority period: How long local criteria apply before the home is offered more widely
- Selection process: What happens if more than one eligible buyer applies
What are the advantages of the First Homes scheme?
The main advantage of the First Homes scheme is the discount. A reduction of 30% to 50% can make a home more affordable than buying the same property on the open market.
For eligible buyers, the scheme can offer:
- Lower purchase price: The home is sold below full market value
- Smaller deposit requirement: Your deposit is usually based on the discounted price
- Smaller mortgage: You may need to borrow less than you would on the open market
- Full ownership: You own 100% of the home from day one
- No rent on an unsold share: Unlike Shared Ownership, there is no remaining share to rent
- Local access: The scheme can help buyers stay close to work, family or support
- New-build choice: Many First Homes properties are part of new developments
First Homes may suit buyers who can afford a mortgage on the discounted price but cannot stretch to the full market value.
It may also appeal if you want to own the whole property straight away, rather than buying a share.
What are the drawbacks of the First Homes scheme?
The First Homes scheme can be helpful, but it is not right for every buyer.
The main drawback is the resale restriction. When you sell, you must usually pass on the same percentage discount to the next eligible buyer. This means you will not sell the home for its full open market value.
You should also think about:
- Limited availability: First Homes properties are not available on every development
- Less choice: You may have fewer options than on the open market
- Local priority rules: Eligibility can depend on council criteria
- Extra application checks: The process can include more paperwork than a standard purchase
- Mortgage choice: Not every lender may accept First Homes applications
- Future sale process: You will usually need to find an eligible buyer when you sell
- Equity position: Your future gain is based on the discounted value, not the full open market value
You can still benefit if the property value rises, but your gain is based on the discounted price.
First Homes and selling in the future
Selling a First Homes property is different from selling a standard home.
You can usually only sell the property to someone who is eligible to buy a First Home. You must give that buyer the same percentage discount that you received, based on the home’s market value at the time of sale.
That means your future buyer will usually need to be:
- A first-time buyer
- Within the income cap
- Able to get a suitable mortgage
- Buying the home as their main residence
- Eligible under any local rules that apply at the time
When you sell, you will need to tell your local council, use an estate agent to market the home under the First Homes scheme, and get the property valued by a surveyor registered with the Royal Institution of Chartered Surveyors. The sale price is based on the valuation minus the First Homes discount.
Once the property has been on the market for more than three months, the buyer no longer has to meet local criteria, although they still need to meet the national First Homes rules.
If you have tried unsuccessfully to sell your property as a First Home for six months or more, or selling it as a First Home would cause severe difficulties, you can ask the council for permission to sell on the open market. If open-market sale is allowed, you will need to return the same percentage of the sale price as your original discount to the council.
This can narrow your pool of buyers. It may also affect how long it takes to sell. If you think you may need to move quickly in a few years, speak to a solicitor before you commit.
Can you let out a First Homes property?
First Homes properties are intended to be lived in by the buyer as their main home. They are not designed as buy-to-let properties.
You can usually let out a First Home for a total of up to two years during your ownership, but you must check whether your mortgage allows it and tell the local council. The two-year limit resets if the home is sold to someone else.
You may be able to let the home for longer than two years in some circumstances, such as a change in job location, redundancy, a relationship breakdown, moving away from domestic abuse, or caring responsibilities. You would need to ask the local council, and you may also need your lender’s permission.
You can usually rent out a room for as long as you live in the home and the property remains the only home you own.
Ask your solicitor to explain:
- Letting rules: Whether letting is allowed under the First Homes restriction
- Consent: Whether you need permission from the council, lender or another party
- Temporary moves: What happens if you need to move away for a short period
- Mortgage conditions: Whether your lender has its own restrictions
- Future flexibility: How the First Homes rules could affect your plans
First Homes compared with Shared Ownership
First Homes and Shared Ownership are both designed to help people buy a home, but they work in different ways.
With First Homes:
- You buy 100% of the home
- You buy at a discount
- You do not pay rent on an unsold share
- The discount stays with the property
- You must usually sell to another eligible buyer at the same discount
With Shared Ownership:
- You buy an initial share of the home
- You usually pay rent on the remaining share
- You may be able to buy more shares over time
- Your monthly costs can be lower than buying outright
- It may be available to buyers who cannot afford a full mortgage
First Homes may suit you if you can get a mortgage for the discounted price and want full ownership from the start.
Shared Ownership may suit you if buying 100% of a home is not affordable, even with a discount.
How to apply for the First Homes scheme
The application process can vary between developers and councils, but it usually follows a similar route.
1. Check the national rules
Start by checking the official GOV.UK’s First Homes scheme guide.
Make sure you meet the basic criteria for:
- Age
- First-time buyer status
- Income
- Mortgage affordability
- Main residence use
2. Check the local council rules
Find the local council for the area using find your local council.
Then check whether the council has extra rules, such as:
- Local connection
- Employment link
- Public-service worker priority
- Local income limits
- Application deadlines
3. Find a First Homes property
First Homes properties are usually found on selected new-build developments. Some resale homes may also become available as earlier First Homes buyers move on. GOV.UK confirms that the scheme can apply to a new home built by a developer or a home bought through an estate agent where someone else previously bought it through the scheme.
You can look for homes through:
- Developer websites
- Local council housing pages
- New-build development information packs
- Sales teams at specific developments
- Estate agents handling First Homes resales
4. Speak to a mortgage adviser
You need to be able to get a mortgage or home purchase plan for at least 50% of the discounted purchase price.
A mortgage adviser with experience in affordable home ownership schemes can help you understand your options.
Ask about:
- Lender choice: Which lenders currently accept First Homes applications
- Deposit level: How much you may need upfront
- Affordability: How the discounted price affects your mortgage position
- Agreement in Principle: Whether you can get an early view from a lender
- Timescales: How long your application may take
5. Reserve the property
If you find a suitable home, the developer will usually ask you to complete an initial eligibility check.
You may also need to pay a reservation fee. Before paying, ask:
- Refunds: Whether the fee is refundable
- Application refusal: What happens if the council refuses your application
- Reservation period: How long the property will be held for you
- Documents: What evidence you need to provide
- Next steps: What happens after reservation
6. Submit your formal application
The developer should guide you through the formal First Homes application. Local authorities and conveyancers use scheme documents to confirm eligibility and support the sale process.
You may need to provide:
- Proof of identity
- Proof of income
- Proof of deposit
- Evidence of first-time buyer status
- Mortgage Agreement in Principle
- Local connection evidence, if required
The local authority will review your application against the scheme rules.
7. Appoint a solicitor
Choose a solicitor or conveyancer with experience in new-build homes and affordable home ownership schemes.
They should explain:
- First Homes restriction: How the discount stays attached to the property
- Resale rules: What you must do when you sell
- Mortgage requirements: How your lender’s conditions interact with the scheme
- Charges: Any service charges, estate charges or other ongoing costs
- Your responsibilities: What you agree to as the homeowner
8. Complete your mortgage application
Once your eligibility is approved, you can move ahead with your full mortgage application.
Your lender will carry out checks on:
- Income
- Deposit
- Credit history
- Affordability
- Property value
- Scheme rules
Keep your solicitor, developer and mortgage adviser updated so the purchase stays on track.
9. Exchange and complete
Once the legal work is ready and your mortgage offer is in place, you can exchange contracts and agree a completion date.
On completion, you become the owner of the home. You will own 100% of the property, but the First Homes restriction will stay attached to it.
What to check before buying through First Homes
Before you reserve a First Homes property, take time to ask the right questions.
Useful questions include:
- Full market value: What is the home valued at before the discount?
- Discount level: What percentage discount applies?
- Discount approval: Who approved the discount?
- Purchase price: What is the discounted price you will pay?
- First sale price cap: Does the discounted price stay within the relevant first-sale cap?
- Local rules: Does the council have extra eligibility criteria?
- Priority period: How long do local priority rules apply?
- Mortgage options: Which lenders are available?
- Application refusal: What happens if your application is not approved?
- Fees: What reservation, legal, mortgage or other fees are payable?
- Ongoing costs: Are there service charges or estate charges?
- Warranty: What warranty comes with the home?
- Resale process: How will you sell the home in future?
- Open-market fallback: What happens if you cannot sell to an eligible First Homes buyer?
- Letting rules: What happens if you need to move away temporarily?
- Improvements: Can you make changes to the property?
- Early move: What happens if you need to move sooner than planned?
Checking the local area before you buy
A home is not just about the property itself. The area around it will shape daily life.
Before buying, check:
- Schools: Use GOV.UK to find information about schools and individual school websites
- GP surgeries: Use NHS find a GP
- Flood risk: Check GOV.UK flood risk
- Council services: Use find your local council
- Planning applications: Check the local council’s own planning portal
- Transport: Review bus, rail and cycling options through official transport providers
- Local facilities: Check parks, leisure centres and libraries through council websites
Is the First Homes scheme right for you?
The First Homes scheme can be a strong option if you are a first-time buyer who wants to stay close to an area and can afford a mortgage on the discounted price.
It may suit you if:
- You meet the eligibility rules
- You want to own 100% of your home
- You can get a suitable mortgage
- You are happy with the resale restriction
- You plan to live in the home as your main residence
- You understand how the discount affects future sale value
It may not suit you if:
- You want to sell freely on the open market
- You may need to move quickly
- You want a wider choice of properties
- You do not meet local priority rules
- You would prefer a lower initial purchase share
If First Homes is not suitable, Shared Ownership may offer another way to buy.
Final thoughts
The First Homes scheme gives eligible first-time buyers the chance to buy a home at 30% to 50% below market value. For some buyers, that can make home ownership more realistic, especially in areas where open market homes are harder to afford.
The discount is helpful, but it comes with long-term rules. When you sell, the same percentage discount must usually be passed on to another eligible buyer. That keeps the home more affordable for future buyers, but it also limits your future sale price.
First Homes are not designed as buy-to-let homes, but owners can usually let the property for up to two years in total during their ownership, provided they follow the scheme and mortgage rules. In some cases, longer letting may be considered by the local council.
Before applying, check the official GOV.UK’s First Homes scheme guide, speak to the local council, get mortgage advice and ask a solicitor to explain the restrictions.
While Guinness Homes provides this guide to help buyers understand their options, Guinness Homes focuses on delivering affordable homes through routes such as Shared Ownership and private sale. Guinness Homes does not currently offer properties through the First Homes scheme.
Published 29 Sep 2023 · Updated 5 May 2026
