Would the 'Your First Home' scheme actually help first-time buyers? Experts weigh in

Autumn Budget announces new 'Your First Home' scheme, but will it actually help first-time buyers? Property experts weigh in

As part of the 2026 Autumn Budget, more information was revealed about the upcoming 'Your First Home' scheme.

The 'Your First Home' scheme will provide first-time buyers with a loan worth 20% of their new-build property's value to help pay for the purchase. The scheme is available with a deposit of 2.5%, with an initial five-year interest-free period for the equity loan.

Applications for the scheme will open in February 2027.

It has now been announced that the scheme will be backed by £4.7 billion of Government-backed lending. However, mortgage specialists at Bower Home Finance have issued a warning over how the scheme may leave future homeowners in debt:

"Burnham's new 'Your First Home' scheme sounds like a really hopeful way for many people to join the property ladder, especially people who may have previously been shut out due to skyrocketing property prices in the UK.

"However, it's really important to flag that an equity loan doesn't reduce the cost of a home. It changes how and when you pay for it.

"An equity loan has to be repaid when you sell, remortgage or reach the end of your mortgage term. It is repaid as a percentage of the home's value at that time, not the amount you originally borrowed. If a £230,000 home rises in value by 3% a year, the 20% share would be worth around £62,000 after ten years, compared with the £46,000 borrowed.

"It's also really important to emphasise that interest charges will gradually increase after the scheme's initial five-year interest-free period has ended. "Buyers who don't plan for the extra fees once the initial interest-free duration ends could discover their total debt lasts longer than they expected.

"As the scheme only applies to new-build properties, the 'Your First Home' scheme poses the risk of increasing property prices due to higher demand.

"However, as Burnham emphasised in the scheme's announcement, this risk will hopefully be reduced by encouraging more new properties to be built in order to keep up with the increased demand.

"If you're considering applying for the scheme, have a plan for repaying the equity loan from day one, whether through overpayments, gradually buying back the government's share, or budgeting for a remortgage. "Be aware that new-build homes can lose value early on, which can also limit your remortgage options. "Used carefully, this scheme can be a genuine springboard for first-time buyers who have previously been priced out of the property market. Without a plan, it can mean carrying debt for longer.

"As announced in the Autumn Budget, there are current household income thresholds and local property price limits in place that mean that the scheme won't be available to every first-time buyer.

"The scheme is expected to help 70,000 people, but it's really important to check whether you're eligible before making any long-term plans."

Study: the UK areas where mortgages may never be paid off

In light of the recent Autumn Budget announcement surrounding the 'Your First Home' scheme, a new study by mortgage specialists at Bower Home Finance has revealed the 25 areas where homeowners will realistically be unable to pay off their mortgages in their lifetime.

The research examined data from the Office for National Statistics to determine the median house price and the median yearly salary for regions across England, Scotland, and Wales. This information was then used to calculate how many years it would take two full-time median earners to pay off the mortgage on a median-priced home when spending 30% of their net monthly pay on mortgage repayments.

Based on the fact that the average first-time property buyer is now aged 34, the study reveals the UK areas where homeowners will be unlikely to ever pay off their mortgages. According to the data, 25 regions fall within this category, with all of these located in either London, the Southeast, or the East of England. Chichester is identified among these regions. According to the data, the median house price in Chichester is £415,000, which is over 33% higher than the UK average. Despite the region's high property prices, workers in Chichester actually earn below the UK average, with a median yearly salary of £35,264, which is nearly 11% lower than the median salary of £39,593.

Due to the region's high property prices, the majority of homeowners in Chichester will be unable to pay off their mortgage in their lifetime. St. Albans is also named among the regions with some of the highest property prices in the UK. Properties in the city sell for a median price of £630,000. Even though workers in St. Albans earn above the UK median salary, with a median salary estimate of £57,396, the city's high property prices mean that homeowners in the region will realistically be unable to pay off their mortgage in their lifetime. Similarly, homes in Kingston upon Thames sell for a median price of £538,000. With the average worker in the area earning a median salary of £46,871, this means that homeowners in Kingston upon Thames will be unable to pay off their mortgages in their lifetimes. Other regions that are identified in this category include Windsor and Maidenhead, Hounslow, Hackney, Waltham Forest, Hillingdon, and Wandsworth.

The 25 regions where the average homeowner cannot clear mortgage payments in their lifetime:

| Area Name | Location | |---|---| | Kensington and Chelsea | London | | Westminster | London | | Camden | London | | Hammersmith and Fulham | London | | Richmond upon Thames | London | | Brent | London | | Mole Valley | Southeast | | Haringey | London | | Ealing | London | | Elmbridge | Southeast | | Islington | London | | Three Rivers | East of England | | Hertsmere | East of England | | Harrow | London | | Barnet | London | | Tandridge | Southeast | | Wandsworth | London | | Hillingdon | London | | Waltham Forest | London | | Hackney | London | | Hounslow | London | | Windsor and Maidenhead | Southeast | | Kingston upon Thames | London | | St Albans | East of England | | Chichester | Southeast |

The study also reveals that in 32 areas, mortgage repayments exceed the standard 40-year term. Some of these regions include Cambridge, Buckinghamshire, Oxford, Brighton and Hove, and Winchester. The study also highlights that homeowners in Scotland can expect to clear their mortgages in the shortest time.

Overall, Scotland's median mortgage repayment duration comes to around 10.5 years. While homeowners in Inverclyde can expect to pay off their mortgages in the shortest duration, property owners in East Lothian face the longest mortgage repayment duration in Scotland, taking around 19.8 years to pay off their mortgages. Properties in the Northeast have the second-quickest mortgage repayment times overall, with a median mortgage repayment duration of nearly 11 years. County Durham is established as the Northeast area with the quickest mortgage repayment time of 9.1 years, while Newcastle has the slowest mortgage repayment duration of 14.2 years. Property owners in Yorkshire and the Humber have the third-shortest mortgage repayment times in the UK, with a median mortgage repayment duration of nearly 13 years. Hull is identified as the region with the lowest mortgage repayment time of 9.5 years, while York has the highest mortgage repayment duration of over 21 years. Other regions with the lowest mortgage repayment times include the Northwest, with a median mortgage repayment duration of nearly 13.8 years, and Wales, which has a median mortgage repayment time of 14 years. London is established as the UK region with the highest mortgage repayment time. According to the data, only five regions in London had mortgage repayment times under 40 years. The data reveals that 10 areas in London had mortgage repayment durations above 40 years, while a staggering 17 London regions had mortgages that would never clear within the average property buyer's lifetime. The median mortgage repayment time in London is over 39 years. The Southeast is home to the second-highest mortgage repayment duration in the UK, with the average property owner in the Southeast taking nearly 30 years to clear their mortgage. The East of England has the third-highest mortgage repayment time in the UK. According to the data, homeowners in the East of England can expect to clear their mortgage in a median time of 26.5 years.

Geoff Charles, the CEO of Bower Home Finance, commented on the study and offered tips on how homeowners can reduce mortgage repayment times:

"It's really staggering to see that house prices in London, the Southeast, and the East of England are so high that the average homeowner cannot afford to pay off the mortgage in their lifetime. "The study highlights that properties in London sell for a whopping median price of £538,255, which means that homeowners are faced with incredibly long mortgage repayment durations. "Similarly, homes in the Southeast sell for a median price of £382,250, while the East of England has a median property price of £345,000. "What really stands out in the study is how much cheaper properties are in Scotland, with a median property price of £183,000. "Out of the top 10 regions with the quickest mortgage repayment durations, Scotland dominates the ranking, highlighting just how much quicker property owners in Scotland can expect to pay off their mortgage. "For homeowners in the UK who are struggling with long mortgage repayment durations, overpayments can be a really quick way to clear your mortgage in certain cases."A mortgage overpayment calculator can be a helpful way for you to establish how much to overpay to shorten your mortgage repayment duration. "Before you make any overpayments, check that your specific lender allows you to do this penalty-free and if there are any particular overpayment limits in place. This is typically up to 10% of your outstanding mortgage balance per year."Most mortgage deals in the UK typically last between two and five years. After this, you will automatically be switched over to your lender's Standard Variable Rate (SVR), which can be incredibly expensive due to interest rates. "Because of this, it's really important that you either choose a new deal with your current provider or switch to a new provider entirely. "In certain cases, changing mortgage providers can make overpayments more flexible, helping to reduce your mortgage repayment time."

According to the data, homeowners in Inverclyde are the most likely to pay off their mortgage. Properties in the Scottish region typically sell for a median price of £123,000, which is over 60% lower than the median UK house price of £310,919. Workers in Inverclyde earn a median salary of £36,650, which means that it'll take the average homeowner in the region 6.9 years to pay off their mortgage. Homeowners in East Ayrshire are the second-most likely to pay off their mortgage. Homes in the Scottish region sell for a median price of £128,500, which is almost 59% below the UK's median property price of £310,919. Meanwhile, workers in East Ayrshire earn a median yearly salary of £37,968. Based on this data, property owners in East Ayrshire can expect to pay off their mortgage in around seven years. Aberdeen City has the third-shortest estimated mortgage repayment time in the study. According to the data, homes in the Scottish city sell for a median price of £138,000, while workers in Aberdeen earn a median yearly salary of £40,020. This means that the expected mortgage repayment duration in Aberdeen is around 7.2 years. Property owners in North Ayrshire can expect to pay off their mortgage in the fourth-quickest time. With properties in the Scottish region selling for a median price of £142,250 and workers earning a median salary of £40,312, homeowners in North Ayrshire can pay off their mortgage in 7.4 years. Scottish regions continue to dominate the study's top five ranking, with West Dunbartonshire also appearing in fourth place. According to the data, properties in the area sell for a median price of £140,563, which is nearly 55% below the UK average price. Workers in West Dunbartonshire can expect to take home a median salary of £40,011, which means that the average mortgage repayment time in West Dunbartonshire is around 7.4 years. Hyndburn and North Lanarkshire both tie for fifth place in the ranking, sharing an estimated mortgage repayment time of 8.1 years. Hyndburn has a low median property price of £135,000. Workers in the Lancashire region earn a median salary of £34,987, which means that they can clear mortgage payments at a quicker rate. While properties in North Lanarkshire have a higher median price of £155,000, workers in the Scottish region also earn a higher median salary of £41,070. This means that it takes less time for property owners in North Lanarkshire to clear mortgage payments. Other regions with low mortgage repayment durations include Burnley, Merthyr Tydfil, Blaenau Gwent, Dundee City, and Blackpool.

The top 10 regions with the lowest mortgage repayment durations:

| Rank | Area Name | Location | Number of Years Required to Clear Mortgage | |---|---|---|---| | 1 | Inverclyde | Scotland | 6.9 | | 2 | East Ayrshire | Scotland | 7.0 | | 3 | Aberdeen City | Scotland | 7.2 | | 4 | North Ayrshire | Scotland | 7.4 | | 4 | West Dunbartonshire | Scotland | 7.4 | | 5 | Hyndburn | Northwest | 8.1 | | 5 | North Lanarkshire | Scotland | 8.1 | | 6 | Burnley | Northwest | 8.2 | | 7 | Merthyr Tydfil | Wales | 8.4 | | 8 | Blaenau Gwent | Wales | 8.5 | | 9 | Dundee City | Scotland | 8.7 | | 10 | Blackpool | Northwest | 9.0 | | 10 | South Ayrshire | Scotland | 9.0 |

This information was provided by mortgage specialists at Bower Home Finance.

Methodology:

The research examined data from the Office for National Statistics to determine the median house price and the median salary for regions across England, Scotland, and Wales.

The study also obtained data from the Bank of England to reveal household mortgage interest rates.

The research then determined the ranking based on the number of years to clear the mortgage on a median-priced local home for two median full-time local earners.

The estimated mortgage repayment time was calculated using a standard mortgage repayment formula, taking into account the initial loan amount (median house price minus the deposit), the monthly interest rate, and the household's assumed monthly repayment capacity.

The study also used the standard assumption that homeowners will be spending 30% of net monthly pay on mortgage repayments. The research also used a fixed mortgage interest rate of 4.93% a year. The study also uses the assumption that the deposit will be 15% of the local median house price.

Data for the average age of a first-time property buyer was sourced from the English Housing Survey.

Please note that the complete ranking below does not include the regions where mortgage repayments exceed the standard 40-year term or the regions where mortgage repayments cannot be cleared in the average homeowner's lifetime.

The link to the complete data set is available on request.

The complete ranking (from lowest to highest mortgage repayment duration):

| Area Name | Number of Years Required to Clear Mortgage | |---|---| | Inverclyde | 6.9 | | East Ayrshire | 7.0 | | Aberdeen City | 7.2 | | North Ayrshire | 7.4 | | West Dunbartonshire | 7.4 | | Hyndburn | 8.1 | | North Lanarkshire | 8.1 | | Burnley | 8.2 | | Merthyr Tydfil | 8.4 | | Blaenau Gwent | 8.5 | | Dundee City | 8.7 | | Blackpool | 9.0 | | South Ayrshire | 9.0 | | County Durham | 9.1 | | Cumberland | 9.2 | | Renfrewshire | 9.3 | | Shetland Islands | 9.3 | | Middlesbrough | 9.4 | | Kingston upon Hull, City of | 9.5 | | Na h-Eileanan Siar | 9.7 | | Falkirk | 9.8 | | Pendle | 9.9 | | Neath Port Talbot | 10.0 | | Sunderland | 10.1 | | Rhondda Cynon Taf | 10.1 | | Dumfries and Galloway | 10.1 | | Orkney Islands | 10.1 | | Fife | 10.2 | | Stoke-on-Trent | 10.3 | | South Lanarkshire | 10.3 | | Redcar and Cleveland | 10.4 | | Stockton-on-Tees | 10.4 | | North East Lincolnshire | 10.4 | | Gateshead | 10.6 | | Clackmannanshire | 10.6 | | Hartlepool | 10.7 | | Argyll and Bute | 10.7 | | Aberdeenshire | 10.8 | | Liverpool | 10.9 | | South Tyneside | 10.9 | | Angus | 10.9 | | Darlington | 11.1 | | Barnsley | 11.1 | | Doncaster | 11.3 | | Glasgow City | 11.4 | | Blackburn with Darwen | 11.6 | | North Lincolnshire | 11.6 | | Carmarthenshire | 11.6 | | St. Helens | 11.7 | | Wyre | 11.8 | | Torfaen | 11.8 | | Preston | 11.9 | | Rossendale | 12.0 | | Knowsley | 12.0 | | Calderdale | 12.2 | | Wigan | 12.3 | | Lincoln | 12.4 | | Scottish Borders | 12.4 | | Bradford | 12.5 | | Caerphilly | 12.5 | | Northumberland | 12.6 | | Bolsover | 12.6 | | Swansea | 12.6 | | Highland | 12.6 | | Chesterfield | 12.7 | | Newcastle-under-Lyme | 12.7 | | Rotherham | 12.9 | | Halton | 13.0 | | Wrexham | 13.0 | | Stirling | 13.0 | | Fylde | 13.2 | | Chorley | 13.4 | | North Tyneside | 13.5 | | West Lothian | 13.5 | | Lancaster | 13.6 | | Mansfield | 13.6 | | Flintshire | 13.6 | | Moray | 13.6 | | Perth and Kinross | 13.6 | | Bassetlaw | 13.7 | | Wirral | 13.8 | | Wakefield | 13.8 | | South Ribble | 13.9 | | Sheffield | 13.9 | | Gwynedd | 13.9 | | Westmorland and Furness | 14.0 | | Bridgend | 14.0 | | Kirklees | 14.1 | | Rochdale | 14.2 | | Newcastle upon Tyne | 14.2 | | Denbighshire | 14.2 | | Staffordshire Moorlands | 14.3 | | Erewash | 14.4 | | Ashfield | 14.5 | | Bolton | 14.5 | | East Riding of Yorkshire | 14.7 | | West Lindsey | 14.7 | | Derby | 14.8 | | Oldham | 14.8 | | Coventry | 14.9 | | Wolverhampton | 15.1 | | Tameside | 15.2 | | Pembrokeshire | 15.2 | | Conwy | 15.3 | | Amber Valley | 15.5 | | Sefton | 15.5 | | Isle of Anglesey | 15.5 | | South Derbyshire | 15.6 | | Tamworth | 15.6 | | Cheshire West and Chester | 15.7 | | Great Yarmouth | 15.7 | | Cannock Chase | 15.7 | | Nottingham | 15.9 | | Newport | 15.9 | | Telford and Wrekin | 16.0 | | Plymouth | 16.0 | | West Lancashire | 16.0 | | Warrington | 16.1 | | East Staffordshire | 16.1 | | Newark and Sherwood | 16.2 | | Rugby | 16.2 | | East Dunbartonshire | 16.4 | | North Kesteven | 16.5 | | Sandwell | 16.5 | | Walsall | 16.5 | | Birmingham | 16.6 | | Ipswich | 16.7 | | Salford | 16.7 | | Forest of Dean | 16.9 | | Broxtowe | 16.9 | | Stafford | 16.9 | | Norwich | 17.0 | | North Warwickshire | 17.0 | | City of Edinburgh | 17.0 | | North East Derbyshire | 17.1 | | Gedling | 17.1 | | Leeds | 17.2 | | Boston | 17.3 | | Ceredigion | 17.4 | | Fenland | 17.5 | | Worcester | 17.5 | | Dudley | 17.5 | | Midlothian | 17.6 | | Gosport | 17.8 | | Ribble Valley | 17.8 | | Manchester | 17.8 | | Powys | 17.8 | | Peterborough | 17.9 | | East Lindsey | 17.9 | | North Northamptonshire | 18.1 | | Nuneaton and Bedworth | 18.1 | | Bury | 18.1 | | East Renfrewshire | 18.1 | | Oadby and Wigston | 18.2 | | Southampton | 18.6 | | High Peak | 18.6 | | Northwest Leicestershire | 18.6 | | Gloucester | 19.3 | | South Holland | 19.3 | | Portsmouth | 19.5 | | Redditch | 19.5 | | Vale of Glamorgan | 19.5 | | Cardiff | 19.5 | | Solihull | 19.6 | | Swindon | 19.7 | | Charnwood | 19.7 | | Hinckley and Bosworth | 19.8 | | East Lothian | 19.8 | | West Suffolk | 20.0 | | Tendring | 20.1 | | King's Lynn and West Norfolk | 20.1 | | Blaby | 20.2 | | Torbay | 20.3 | | Cheshire East | 20.4 | | Eastbourne | 20.4 | | Dover | 20.5 | | Shropshire | 20.6 | | North Yorkshire | 20.6 | | Derbyshire Dales | 20.6 | | Wyre Forest | 20.6 | | Leicester | 20.7 | | South Staffordshire | 21.0 | | South Kesteven | 21.1 | | Monmouthshire | 21.2 | | York | 21.4 | | Breckland | 21.6 | | Rushcliffe | 21.8 | | South Norfolk | 22.0 | | Mid Suffolk | 22.0 | | Lichfield | 22.2 | | Warwick | 22.2 | | Stockport | 22.5 | | Somerset | 22.6 | | Cheltenham | 22.6 | | West Devon | 22.8 | | East Suffolk | 22.8 | | Medway | 22.9 | | Melton | 22.9 | | West Northamptonshire | 23.1 | | North Somerset | 23.2 | | Harborough | 23.2 | | Swale | 23.3 | | Torridge | 23.5 | | Hastings | 23.5 | | Mid Devon | 23.7 | | Fareham | 23.7 | | Rutland | 23.8 | | Broadland | 23.9 | | Bromsgrove | 23.9 | | Thanet | 24.1 | | Folkestone and Hythe | 24.4 | | Stevenage | 24.5 | | Cornwall | 24.8 | | Eastleigh | 24.9 | | Southend-on-Sea | 25.2 | | Basingstoke and Deane | 25.2 | | Isle of Wight | 25.3 | | East Cambridgeshire | 25.3 | | Tewkesbury | 25.5 | | Colchester | 25.7 | | Herefordshire, County of | 26.0 | | Teignbridge | 26.0 | | South Gloucestershire | 26.1 | | East Devon | 26.1 | | Bedford | 26.3 | | Huntingdonshire | 26.3 | | Wiltshire | 26.4 | | Central Bedfordshire | 26.6 | | Milton Keynes | 26.9 | | Thurrock | 27.0 | | Stroud | 27.1 | | Exeter | 27.3 | | Gravesham | 27.5 | | North Norfolk | 27.5 | | Dartford | 27.6 | | Cherwell | 27.6 | | Havant | 27.7 | | Reading | 27.8 | | Castle Point | 28.1 | | Braintree | 28.2 | | Harlow | 28.3 | | Trafford | 28.6 | | Wealden | 29 |