Prime Minister Andy Burnham has unveiled "Your First Home", a new government equity loan scheme designed to help first-time buyers in England get on the property ladder. The initiative, announced ahead of Burnham's first Labour conference as leader, allows buyers to purchase a new-build home with a deposit of just 2.5% of its value, supported by a government equity loan of up to 20%. The scheme is limited to new-build properties from participating housebuilders, with regional price caps and household income limits to be confirmed in Chancellor John Healey's October Budget. An initial interest-free period on the equity loan is also planned, with developers expected to contribute to the scheme's running costs.
The announcement triggered a sharp rally across UK housebuilding stocks on Monday 28 September. The FTSE 350 Household Goods & Home Construction Total Return Index surged approximately 11%, reversing a 13% decline over the preceding 12 months. In the FTSE 100, Barratt Redrow gained around 13%, while in the FTSE 250, Persimmon jumped 16%, Bellway and Taylor Wimpey both rose 12%, and Vistry climbed 10%. The sector had been under pressure for months amid rising mortgage rates and persistent inflation that eroded affordability for buyers.
Analysts reacted with cautious optimism. Jack Fletcher-Price of Morningstar called the scheme "the catalyst the UK homebuilding sector has been waiting for", saying anything that lowers the deposit barrier for first-time buyers should translate into stronger demand and higher reservation rates for new-build homes. Peel Hunt estimated that a well-designed scheme could deliver a 10% increase in volumes by 2028, a 200-basis-point improvement in gross margin, and an approximately 70% uplift in sector earnings per share. Hargreaves Lansdown noted that the previous Help to Buy scheme, which ran from 2013 to 2023, supported more than 387,000 purchases, of which around 328,000 were by first-time buyers, suggesting a well-crafted successor could meaningfully lift demand.