First Homes Scheme Explained

First Homes Scheme Explained
In June 2021, the First Homes Scheme was introduced in England. This scheme gives a minimum of 30% off of the market value of a new build property. However, the local council can increase this discount up to 50%.
In the current housing market where the prices have increased considerably, this scheme will help many first time buyers get onto the property ladder. This Government scheme can not be used with any of the other available Government schemes but you can still use a Help to Buy ISA or a Lifetime ISA if you have one.
Those of us in the Armed Forces can also use this scheme and are also not limited to the restrictions that local councils might places on these properties. We can also use the Forces Help To Buy Scheme as well.
This is one of the better Government help to buy schemes out there. There are still limited supply of houses on the scheme but 1000s more are expected to be added in the coming years as more and more houses are built.
Links:
Forces Help To Buy Scheme - • Forces Help To Buy Exp...
ISAs Explained - • Individual Savings Acc...
OwnYourHome - www.ownyourhome.gov.uk/which-...
Timecodes:
0:00 Intro
1:13 What is the First Homes Scheme?
1:51 Do I need to be a first time buyer/owner?
2:10 Are the Armed Forces limited by the ‘local area’ criteria of the scheme?
2:34 Is there an overall household income cap for the First Homes Scheme?
2:55 Is there are house price cap for the First Homes Scheme?
3:29 Can I sell my First Homes house?
3:59 Can I rent/let out my First Homes house?
4:23 Final thoughts
5:19 Outro
Sources:
www.gov.uk/government/publica...
www.gov.uk/first-homes-scheme
DISCLAIMER:
I am not a professional financial advisor and this video is not financial advice. Please do your own research before making any decisions with your money and seek professional financial advice if need be.

[@thesavvysquaddie]

Timecodes:
0:00 Intro
1:13 What is the First Homes Scheme?
1:51 Do I need to be a first time buyer/owner?
2:10 Are the Armed Forces limited by the ‘local area’ criteria of the scheme?
2:34 Is there an overall household income cap for the First Homes Scheme?
2:55 Is there are house price cap for the First Homes Scheme?
3:29 Can I sell my First Homes house?
3:59 Can I rent/let out my First Homes house?
4:23 Final thoughts
5:19 Outro

[@Allied-Aircraft-WW2]

What an excellent new scheme. First time I’ve come across it.

[@thesavvysquaddie]

Ya it hasn't been hugely publicised. It is still also quite a new scheme with not that many houses on it at the moment.

[@mizislam5357]

So if the houses in Hampshire are 400k and over how do we get the house at 250k if your not a key worker with 30% discount is there charity on what jobs are Essential workers im asking as i work for a huge defence company in engineering on mod projects would that be accepted for 50% discount?

[@garethfairclough8715]

I've never heard of it, but it sounds like a great scheme!
*Cries silently in Welsh*.

[@thesavvysquaddie]

Hopefully it will expand wider than just England.

[@saugatrai1579]

how can you find the new build properties that are available as part of the first homes scheme? are there any websites ?

[@thesavvysquaddie]

Sadly there are no websites, which is frustrating. Instead you have to approach the new build developments and ask them directly whether or not they are building some houses that will be on the scheme.

[@jdub7273]

What happens when you sell the property ? on the capital gains or capital growth made on a property , if you started with 20% to 50% discount and that equates to £75,000 in nominal terms ?? For example,
If I use the example of buying a £300000 house with a 25% discount for £225,000 and sold a number of years down the line for £400,000 , do I only owe the nominal amount of the remainder of the £75,000 discount I had or a %25 discount of the new value ?

[@thesavvysquaddie]

Capital gains is only paid on properties that are not your primary residence and as this scheme is for first time buyers only, the chances of it not being their primary residence is very low.

[@jdub7273]

@@thesavvysquaddie brilliant thank you for your reply, sorry if didn’t understand my question, but when I sell the property in the future , do I have to sell with the same discount that I received ? Regardless of the new value, that’s if it has gone up in value?

[@thesavvysquaddie]

Yes, you will have to apply the same discount and can only sell to people eligible for the scheme. If the property value has increased, you will still make a profit but you wont be able to profit from whatever percentage discount you were given. If the property does not sell within 6 months, then it will be open to anyone to buy but the % discount will be paid to the council. Hopefully that makes sense.

[@Cocogram95]

I spoke to my mortgage advisor and she said you are unable to use forces help to buy scheme on a first homes discount.

[@thesavvysquaddie]

Ah okay, I heard different from my one when I initially intended on buying last year. Some crossed wires and confusion perhaps. The Forces Help To Buy does not have to be solely used for the deposit, it can be used for legal fees and other associated costs with buying a house minus furnishings. So perhaps there is still some merit to what both advisors have said.

[@SA-oj7rp]

Where do I find the first home scheme properties?

[@thesavvysquaddie]

Annoyingly I don't think there is a single repository that shows them all. Instead it's down to the individual developers to advertise them as they build new homes, to which I don't think they are doing very publicly.

[@BHAYCE]

Hello, I've been looking for a developer in the South East with First home scheme for over 2 years with no joy. Could you please sign post me?

[@313rupz]

If we are planning to pass the house down to our children then how would that work?

[@thesavvysquaddie]

If it's done in a will then it should be fine but thr discount will still apply if they sell the house. But best person to talk to with regards to that would be a solicitor

[@2028]

Hi,
What about giving my discount house for rent in future??

[@thesavvysquaddie]

I think renting is covered in the video.

[@KB77mp]

I am a private soldier. What are my chances of benefitting from this scheme given the current salary I am on now?

[@thesavvysquaddie]

You can still benefit from it but as it is still quite a new scheme and not many houses are on it, then finding a house will be difficult. Personally, if I was in your situation, I wouldn't be rushing to get onto the property ladder just yet. Especially if you are single and living in the block, you are in the best possible position to take advantage of the subsidised living and save a lot of money for a large deposit and invest for your future. Here is a link to a really good podcast that might help add some perspective. th-cam.com/video/n2f540R9-f4/w-d-xo.html

[@waz5107]

But members of the MPGS cannot us the this scheme

[@thesavvysquaddie]

Why is that?

[@demoix]

Would be great if there were developers who participated in this scheme in the first place, because in my council area, there are no developers who are in this scheme... Even in the wider area, there are no companies doing this scheme... I mean there is even no some kind of list where you can find developer companies who are participating in this scheme which makes all this scheme just raise an eyebrow...

[@thesavvysquaddie]

I agree, the implementation of this has been poor unfortunately.