Mortgage Guide: Help to Buy Alternatives in the UK for 2026 — Every Scheme You Can Still Use

Help to Buy was actually two distinct products, and both have now closed.

The Help to Buy equity loan allowed first-time buyers in England to purchase a new-build home worth up to £600,000 (with regional price caps from 2021) with just a 5 per cent deposit. The government lent up to 20 per cent of the purchase price — or 40 per cent in London — interest-free for the first five years. After that, a fee of 1.75 per cent of the loan's value kicked in, rising annually by RPI plus 1 per cent. The scheme generated over 380,000 completions before it closed to new applications on 31 October 2022 and to completions on 31 March 2023.

The Help to Buy ISA was a savings account that topped up contributions with a 25 per cent government bonus, capped at £3,000 on a maximum balance of £12,000. It closed to new applicants in November 2019, though existing holders can continue saving until November 2029 and claim their bonus by November 2030.

With both programmes wound down, buyers need to look elsewhere. The government's stated position is that housing supply — not demand-side subsidies — is the long-term solution, but several targeted schemes survive. The sections below examine each one in detail. For more details, see our guide on first-time buyer mortgages.

First Homes is an England-only programme that offers first-time buyers a discount of 30 to 50 per cent on the market value of a new-build or resale First Home. The discount is set by the local authority and stays with the property in perpetuity: when you sell, the next buyer receives the same percentage reduction, keeping the home affordable for future generations.

Eligibility criteria:

• You must be a first-time buyer.
• Your household income must not exceed £80,000, or £90,000 in London.
• You must take out a mortgage for at least 50 per cent of the discounted purchase price.
• After the discount is applied, the price must not exceed £250,000 (or £420,000 in London).
• Local authorities may impose additional criteria, such as a local connection test or a lower income cap.

How the numbers work: Suppose a new-build flat has a market value of £240,000 and the local discount is 30 per cent. You would pay £168,000. With a 10 per cent deposit of £16,800 and a mortgage of £151,200, you are on the ladder at a price point well below the regional average.

The main drawback is availability. First Homes are delivered through Section 106 planning obligations on new developments, so supply depends on where builders are active and how local authorities allocate affordable housing quotas. In practice, competition for units can be fierce in high-demand areas. Properties are also sold with a restriction on the title, which some mortgage lenders are still cautious about — though the number of participating lenders has grown since the scheme's 2021 launch.

For more on how first-time buyer schemes interact with mortgage products, see our guide to shared ownership mortgages. For more details, see our guide on [Lifetime ISA</a>.

Shared Ownership has been available in various forms since the 1980s and remains one of the most widely used affordable home ownership routes in the UK. It is available in England, Wales, Scotland, and Northern Ireland, though the detailed rules differ by nation.

Under the scheme you buy a share of between 10 and 75 per cent of a property — typically a new-build, though resales of existing Shared Ownership homes are also eligible — and pay subsidised rent on the share retained by the housing association landlord. Your deposit is usually 5 to 10 per cent of your share, not the full property value. On a home worth £290,000, buying a 40 per cent share (£116,000) with a 10 per cent deposit means you need £11,600 upfront, compared with tens of thousands for a conventional purchase.

Over time you can staircase, buying additional shares in increments of 5 or 10 per cent until you own the home outright. Each staircasing transaction requires a new valuation, and you pay the market rate for the extra share at that point — so if property values have risen, staircasing costs more than you might expect.

Key considerations:

• Shared Ownership properties are almost always leasehold. Ground rent and service charges apply, and these can increase over time.
• Mortgage choice is narrower than for standard purchases, though most major lenders now offer Shared Ownership products.
• Selling can be more complex. The housing association usually has a nomination period during which it can find a buyer before the property goes on the open market.
• Since April 2024, new Shared Ownership leases in England include a 10-year initial repair period during which the landlord covers the cost of essential repairs, reducing a longstanding pain point for shared owners.

Shared Ownership is particularly useful in expensive regions where even a 95 per cent LTV mortgage on the full price would be unaffordable. However, the combination of mortgage payments, rent, and service charges can sometimes rival the cost of buying outright at a higher LTV — so run the numbers carefully.

Right to Shared Ownership is a related route available to existing council and housing association tenants in England. If your landlord participates, you can buy a share of your current rental home on Shared Ownership terms, without needing to move. Eligibility and availability vary by landlord, so check directly with your housing provider.

For more details, see our guide on stamp duty. (Source: Stamp Duty Land Tax)

The Lifetime ISA (LISA) is the closest surviving relative of the Help to Buy ISA, and in many respects it is more generous. You can contribute up to £4,000 per year and the government adds a 25 per cent bonus on every pound you put in — up to £1,000 per year in free money. Over several years of maximum contributions, the bonus alone can amount to a significant deposit boost.

Rules to know:

• You must be aged 18 to 39 to open a LISA, but you can keep contributing until age 50.
• The property you buy must cost £450,000 or less.
• You must be a first-time buyer (you must never have owned a home anywhere in the world).
• The LISA must have been open for at least 12 months before you use it to buy.
• If you withdraw funds for any purpose other than buying a qualifying first home or retirement after age 60, you face a 25 per cent penalty on the withdrawal amount — which actually means you lose some of your own money, not just the bonus.

Let us illustrate the penalty trap. If you save £4,000 and receive a £1,000 bonus, your pot is £5,000. A 25 per cent early withdrawal charge on £5,000 is £1,250 — meaning you get back only £3,750, which is £250 less than you put in. This is a crucial detail that catches many savers off guard.

The £450,000 property price cap has not been uprated since the LISA launched in 2017. With average UK house prices now around £290,000, the cap still covers most purchases outside London and the South East, but buyers targeting higher-value properties should check their sums carefully. (Source: ONS house price index)

A LISA can be combined with other schemes. For example, you could use a LISA for your deposit while purchasing through Shared Ownership or First Homes — provided you meet the eligibility criteria of both. This stacking strategy is one of the most cost-effective ways onto the property ladder in 2026.

For a deeper look at how the LISA compares with other tax-wrapped savings accounts, see our Lifetime ISA guide.

Two relatively new initiatives shift part of the financial burden from the buyer to the housebuilder.

Deposit Unlock is a scheme where the developer funds an insurance policy that protects the mortgage lender against losses on 95 per cent loan-to-value mortgages on new-build homes. (Source: mortgage interest rates) (Source: National Insurance) Historically, many lenders refused to offer 95 per cent LTV on new-builds because of concerns about the so-called new-build premium — the risk that a newly built property might fall in value shortly after purchase. Deposit Unlock removes that barrier by underwriting the risk through an indemnity arrangement paid for by the builder. From the buyer's perspective, you simply need a 5 per cent deposit and can access mortgage rates that might otherwise be unavailable on a new-build at that LTV. (Source: Bank Rate)

The scheme was developed by the Home Builders Federation in partnership with several major lenders, including Nationwide, Halifax, and Barclays. Availability depends on the development: not every builder participates, and not every site is covered.

Own New Rate Reducer takes a different approach. Instead of helping with the deposit, the developer contributes a lump sum — typically equivalent to a few per cent of the property price — that the buyer uses to buy down the mortgage interest rate. The mechanics work like paying for a large upfront fee to secure a lower fixed rate. In a market where the BoE base rate is 3.75 per cent and typical two-year fixed rates are in the 4 to 5 per cent range, a developer subsidy could meaningfully reduce monthly payments for the initial fixed period.

Own New Rate Reducer launched in late 2023 and is backed by lenders including Accord Mortgages, Halifax, and Gen H. Again, participation is development-specific.

Pros of developer-backed schemes:

• No government bureaucracy or complex eligibility criteria beyond being able to secure a mortgage.
• Can be combined with a LISA or other savings strategies.
• The developer absorbs a cost that would otherwise fall on the buyer.

Cons:

• Only available on new-build properties from participating developers.
• The developer's contribution may be priced into the property, so the headline price could be higher than comparable resale homes.
• Rate Reducer benefits expire at the end of the fixed term — you remortgage at prevailing market rates.

If you are considering a new-build, ask the sales office whether either scheme is available on the development you are interested in. Compare the total cost of ownership — including any premium on the new-build price — against buying a resale property with a standard mortgage.

This article is for informational purposes only and does not constitute regulated financial advice. Mortgage products and rates change frequently — always check the latest deals directly with lenders. For personalised advice on your mortgage options, consult a qualified mortgage adviser.