Building more homes Contents

Annex 3: Government Initiatives to Help Home Ownership

Help to Buy Schemes


Start and end date (if any)


Details of discount or subsidy

Type of buyer

Type of home

Help to Buy Equity Loan327

Start: April 2013

End: 2021328

Anyone who does not currently own a property.

New build property up to a value of £600,000.

Government loan of up to 20% of the cost of a new-build home. The buyer therefore needs a 5% cash deposit and a 75% mortgage to make up the rest. There are no loan fees on the 20% loan for the first five years

From February 2016 the upper limit for the equity loan for homes within Greater London rose from 20% to 40%.329

Help to Buy Mortgage Guarantee330

Start: March 2012/ Oct 2013

End: Dec 2016

Anyone who does not currently own a property.

Any properties up to a value of £600,000.

The Government offers lenders the option to purchase a guarantee on mortgage loans.

Lenders offer home buyers higher loan-to-value mortgages (80–95%).

The buyer remains fully responsible for mortgage repayments.

Help to Buy ISA331

Start: March 2015

First Time Buyers.

Can be used to purchase any property worth less than £250,000 (outside London) or £450,000 (London).

First time buyers who save through a Help to Buy ISA receive a bonus of 25% of the amount saved (to a maximum of £3,000). The bonus is paid when the first home is purchased.

Other initiatives


Start and end date (if any)


Details of discount or subsidy

Type of buyer

Type of home

Shared Ownership332

Start: 1980 (the most recent version of the scheme was announced in 2015).

First time buyers on an income of less than £80,000 p.a. outside London and £90,000 p.a. in London.

Shared ownership homes only.

Applicants buy a minimum 25% share in a leasehold property the remainder is owned by a housing association.

Applicants may ‘staircase’ and buy additional shares (usually in 10% tranches up to 100%).

Starter Homes

Start: Announced 15 December 2014.333 Buyers can register for homes.334

First time buyers under 40.

Homes built as starter homes.

200,000 new homes to be built sold at up to a 20% discount to first time buyers.

The discounted price will be no more than £250,000 outside London and £450,000 in London.

Life Time ISA335

Start: April 2017

Any person between the age of 18 and 40.

Any home.

Savers can contribute up to £4,000 each year from the age of 18 to 50. The Government will pay a 25% bonus.

The ISA can be used for ‘significant life events’ which are yet to be defined but include retirement and house purchase.

Schemes to assist tenants to buy their home/a home


Start and end date (if any)


Details of discount or subsidy

Right to Buy336

Start: Oct 1980

Local authority tenants who have lived in their homes for 3 years, most former local authority tenants living in homes transferred to housing associations, and most housing association tenants who have lived in their home since 15.1.1989.

Qualifying tenants have the right to buy their home at a discount.

The current discount levels are: maximum discount £77, 900 (outside London) and £103,900 (London).

Right to Acquire337

1996, most recent revision in 2002

Housing association tenants who have had a public sector landlord for three years.

Qualifying tenants have the right to buy a home at a discount of £9,000–£16,000. The amount of discount offered depends on the local authority.

The housing association may sell the tenant an alternative property (at a discount) rather than the tenant’s current home.

Voluntary Right to Buy338

Start: May 2016 (pilot schemes)

All housing association tenants in living in social or affordable rented homes.

Housing association tenants will have the right to buy a home at ‘Right to Buy’ level discounts which are £77, 900 (outside London) £103,900 (London).

There is a presumption that this will be the home where the tenant lives, but housing associations have the discretion to sell the tenant a different property.

Cash Incentive schemes339

Start: April 2003

Local authority social housing tenants

Local authorities the discretion to make grants to social housing tenants to buy a home on the open market.

The size of the grant is at the discretion of the local authority taking into account local market conditions.

Social Mobility Fund340

Start: Feb 2015

Social housing tenants.

£42m in 2015–2016 to offer social housing tenants up to £20,000 (outside London) and £30,000 (London) to buy a home on the open market.

Rent to Buy341

Start: 26.9.2014

(now closed to new bidders)

First time buyers, or previous home owners who can no longer afford to buy, who have household earnings of £60,000 a year or less (£64,300 in London).

Allows tenants to rent affordably (at up to 80% of the market rent) and save for a deposit to buy their rented home or a different home at a later stage.

New homes built under the scheme are available at less than market rent for seven years after which the tenant has first refusal to buy the property or move to another rented or purchased home.

Social Home Buy342

April 2006

Housing association and local authority tenants who do not qualify for other right to buy schemes.

Discretionary shared ownership scheme. The tenant buys a minimum 25% share of the property at a discount (between £9,000 and £16,000 depending on local authority) and can purchase further shares, also at a discount.

327 HM Government, ‘Help to Buy, Equity Loan’: [accessed April 2016]

328 HM Treasury, Spending Review and Autumn Statement 2015, Cm 9162, November 2015: [accessed April 2016]

329 HM Government, ‘Help to Buy, London Help to Buy’: [accessed April 2016]

330 HM Government, ‘Help to Buy, Mortgage Guarantee’: [accessed April 2016]

331 HM Treasury, Budget 2015, HC 1093, March 2015: [accessed April 2016]; HM Government, ‘Help to Buy, ISA’: [accessed April 2016]

332 HM Treasury, Spending Review and Autumn Statement 2015, op. cit.

333 DCLG, Stepping on the ladder: High quality Starter Homes for first time buyers, December 2014: [accessed April 2016] the Scheme was extended in the Autumn statement 2015, HM Treasury, Spending Review and Autumn Statement 2015, Cm 9162, November 2015, Op cit.

334 DCLG, Young first-time buyers can register online for 100,000 cut-price homes, 28 February 2015: [accessed April 2016]

335 HM Treasury, Budget 2016, op. cit.

336 HM Government, ‘Your Right to Buy’: [accessed April 2016]

337 The Housing (Right to Acquire) Discount Order 2002, SI 2002/1901; Homes and Communities Agency, Capital Funding Guide, part 12: [accessed May 2016]

338 As agreed between the National Housing Federation and the Government. DCLG, ‘Historic agreement will extend the right to buy to 1.3 million more tenants’, 7 October 2015: [accessed April 2016]

339 The Regulatory Reform (Schemes under Section 129 of the Housing Act 1988) (England) Order 2003, SI 2003/986; The London Borough of Tower Hamlets, Cash Incentive Scheme: [accessed April 2016]

340 DCLG, Right to Buy, Social Mobility Fund: Prospectus, February 2015: [accessed April 2016]

342 DCLG, Social Home Buy, guidance for local authorities, January 2010 ; ‘Shared Ownership for tenants’ November 2014: [accessed April 2016]

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