Your First Home: what a new buyer scheme means for land
Planning has spent two years opening up land. Your First Home is the finance on the buying side, and the last scheme like it sent housebuilders straight back into the land market.
On 26 September 2026 the government announced Your First Home, a new equity loan scheme for first-time buyers in England. A buyer puts down a 2.5% deposit. The government lends 20% of the price, with an initial interest-free period. A bank lends the rest. The scheme applies only to new-build homes, bought from housebuilders who sign up to it.
That last condition is the one that matters to a landowner. Help with a deposit on any home would mostly move existing houses between owners. Help that applies only to new homes flows straight into housebuilders’ sales, and what housebuilders sell decides what they can afford to pay for land.
The detail, including price caps, an income cap and the cost, comes at the Budget on 28 October. This is a plain account of what is known now and why it points in a good direction for land.
Why housebuilders asked for it
Housebuilders build at the pace they can sell. The industry measures that as sales per outlet per week, and through 2026 it has been falling. Taylor Wimpey reported 0.75 in the first half of the year and 0.55 in the four weeks to 26 July, blaming higher mortgage rates that had “further stretched affordability, particularly for first time buyers and customers in the South of England”. In the same results it asked the government for “a new equity loan scheme”.
Slower sales have weighed on land. Savills’ latest land market survey, for the second quarter of 2026, recorded greenfield land values down 1.2% on the quarter and 3.3% on the year, and described a market where “caution rules”. At the start of the year, it noted, the industry had been expecting cheaper borrowing and rising new-build demand. Neither arrived on schedule.
Your First Home is aimed at that gap. The government’s own release calls it “a much-needed stimulus to support the market and boost housing supply”. The Home Builders Federation welcomed it the same day, saying it was important that the government “moves quickly to implement the scheme”.
The stock market gave its verdict on the first day of trading. On Monday 28 September, shares in the volume housebuilders rose by between 10% and 20%, while the FTSE 100 slipped.
Closing prices on the London Stock Exchange, via Yahoo Finance. Bars are drawn to the same scale.
The biggest rise of all was at Ibstock, which makes bricks. Bricks are bought when homes are started, so investors were betting on more building, not only more sales. For landowners that is the signal that matters. A housebuilder that expects to start more homes needs more land to start them on.
What happened last time
The scheme most like it is Help to Buy, which ran from 2013 to 2023 and financed 387,195 home purchases in England. Its final government evaluation was published on 15 September 2026, eleven days before this announcement, and it reads well for anyone with land to sell.
The evaluation found that about 15% of the new homes built in England over the scheme’s life were the result of it. Larger housebuilders told the evaluators they built between 10% and 40% more homes during the scheme than before or after it. The more telling finding for a landowner is what they did with the money. They described “directing their cash flow into buying more land, opening more sites and building more properties on them”. Some described “intense competition for land”.
One national housebuilder put it directly: “If our business is going to grow, we have to keep replacing our land bank and therefore we need to replace our land bank at a faster rate.”
The evaluation also rated the scheme very high value for money, and it measured the benefit in a way worth noting. The gain to society was calculated as the land value uplift created by the extra homes.
It is worth being clear about scale. Most of that effect came in years of very low interest rates. The later, capped version of the scheme, from 2021, did much less for supply, according to the same evaluation, partly because 95% mortgages had returned by then. Industry economists, including Noble Francis of the Construction Products Association, expect Your First Home to be smaller than the original. The case for land does not rest on a repeat of 2013. It rests on the sites close to the line, which a steadier flow of buyers can bring back into play.
Planning opened the door. This is the finance on the other side
The planning system has spent the past two years making more land available. The December 2024 framework created grey belt. The revised framework published on 17 August 2026 widens where housing can be permitted again. Savills now expects the flow of consented land “should increase in the medium to long term in England”.
What has held sites back is cost. The Home Builders Federation estimates that £76,000 has been added to the cost of building a home since 2020, through taxes, regulation and inflation in materials and labour. It puts that at over 20% of the average new home’s value. The HBF represents the builders, and its figure should be read as theirs. The government’s release makes the same point more briefly, citing “rising construction costs”.
That is why a buyer scheme matters to land. Most development land is bought on what the Competition and Markets Authority calls the residual valuation model. A housebuilder works out what the finished homes will sell for, takes off its build costs, finance and margin, and what is left is what it can pay for the land. When costs rise and prices do not, the part left for land is squeezed first.
Your First Home does not lower a single cost. It works on the other side of the sum. More buyers can reach the price, which supports the sales values in the appraisal. Homes sell faster, which cuts the time money is tied up in a site and the finance cost that goes with it. On a site where costs have eaten the margin, surer and faster sales can be the difference between a scheme that does not work and one that does. When a builder expects that support to last for several years, it also has a reason to secure its next sites now.
A worked example
The sum is easier to see with numbers. The figures below are illustrative, not a valuation of any real site.
Take a site of 100 homes selling at £300,000 each, so £30 million of sales. Build costs, infrastructure, fees and policy costs come to £18 million. The builder’s margin is 17.5% of sales, the middle of the 15% to 20% range in planning guidance. Borrowing averages £9 million at 7% a year while the homes sell.
| Slow market | Faster sales | Faster sales, prices 1% firmer | |
|---|---|---|---|
| Sales per week | 0.55 | 0.75 | 0.75 |
| Time to sell 100 homes | 3.5 years | 2.6 years | 2.6 years |
| Finance cost | £2.20m | £1.62m | £1.62m |
| Builder’s margin | £5.25m | £5.25m | £5.30m |
| Left for the land | £4.55m | £5.13m | £5.38m |
Faster sales alone lift what the builder can pay for the land by about 13%. Add a 1% firmer price, the extra new-build premium the Help to Buy evaluation found, and the land value rises by about 18%. Nothing about the site has changed. The land is the last line in the sum, so it takes every change above it, magnified.
The same sum explains why costs still matter most. The Home Builders Federation’s £76,000 a home, across 100 homes, is £7.6 million, more than the whole land value in any of the three columns. That is what “close to the line” means in practice.
More money is looking for land
Your First Home is not the only new source of money pointed at development. The National Housing Bank, which opened on 1 April 2026, now lends to smaller housebuilders on schemes of 5 homes or more, with loans from £250,000 to £200 million. Its terms matter to anyone selling land. It offers an accelerator loan with “headroom to purchase 100% of the land for your next scheme”, and it states that a builder’s “equity contribution can include planning gain”. In plain terms, a site with planning permission can help a smaller builder fund its own purchase. It also describes itself as having “a strong appetite for risk”.
On the buyer’s side, the Bank of England has cut its rate from 5.25% in August 2024 to 3.75%, the government has made its 95% mortgage guarantee permanent, and lenders have more room to lend at higher multiples of income. Each of those makes the finished homes easier to sell, and so makes the land under them easier to buy. For the national picture behind all this, see our look at the maths of 1.5 million homes.
So the effect on land will not be the same everywhere. Where costs have already pushed a scheme far underwater, a buyer scheme alone will not rescue it. Where a site is close to the line, it can tip the numbers. Across the market as a whole, more buyers able to pay the price means more value in development, and more of it available for land. With planning more permissive than it has been for years, the finance to buy the finished homes was the missing part.
Where the detail will matter
Three pieces of detail will decide how much of it reaches your land.
The price caps. The scheme will have “local property price caps”. When Help to Buy was capped by region in 2021, the South West limit was £349,000. In high-value districts that was well below typical new-build prices, and the scheme all but disappeared there. Cotswold District recorded 628 Help to Buy purchases across the scheme’s life, and only 9 under the capped version. Caps set closer to local prices would carry the benefit into those markets. Regional caps would concentrate it in lower-value ones.
The income cap. The scheme is designed for buyers who could not otherwise purchase. A tight cap narrows the pool, particularly in areas where new homes are expensive.
The housebuilder’s contribution. Builders will pay to join the scheme. The rate has not been announced. A modest fee leaves most of the benefit in the appraisal. A heavy one takes some back.
What this means for you
If you own land with housing potential, nothing here changes the planning position of your site. What it can change is the appetite of the people who buy consented land, and the price they can justify. If the Budget confirms caps that suit your area, it improves the backdrop for any land coming to market over the next few years.
It is also a reminder that timing and preparation count. Housebuilders replenishing land banks look first for sites that are well located and ready for planning. Land in that position is the land that benefits first when demand improves. How you bring it to market matters as much, and promotion and option agreements share the uplift in different ways.
If you are wondering where your land stands, our free Land Potential Check reads a pin, postcode or grid reference against national planning data. It gives you an honest first indication, not a valuation or a planning verdict. We will look again at what the scheme means for land once the Chancellor sets out the detail on 28 October.
This article is general information and reflects our reading of policy at the time of writing. It is not financial, tax, planning or legal advice, it is not a valuation, and it is not a guarantee of planning permission. Policy changes, and every site and situation is different, so please take your own professional advice before acting on anything set out here.