Nearly four in five UK adults now say that saving a deposit is one of the biggest barriers to buying a home, according to recent research. That figure — 79% of people surveyed — tells you something important: the problem isn’t just about high prices, but about how you get your foot in the door in the first place. I’ve been writing about the UK property market for years, and the question I hear most often isn’t “which apartment should I buy?” — it’s “how on earth do I afford one?” The answer, more often than not, lies in government schemes that most buyers simply don’t know exist or assume they won’t qualify for.
These schemes aren’t theoretical. They’re active, funded, and designed specifically for people like you who want to buy an apartment but don’t have a massive deposit saved up. The trick is knowing which one fits your situation — and that’s what this guide is for. Here’s what you actually need to know.
How the main government schemes actually work
Let’s start with the most important thing: these schemes aren’t complicated once you strip away the jargon. The core idea behind all of them is the same — the government steps in to make buying more affordable, either by reducing the amount you need to borrow, giving you free money to save, or guaranteeing part of your loan so lenders feel comfortable offering you a mortgage with a small deposit.
Shared Ownership is probably the most flexible option for apartment buyers. You purchase a share of the property — typically between 25% and 75% — and pay a reduced rent on the remaining share to a housing association. Your deposit is based only on the share you’re buying, so if you’re buying a 40% share, a 5% deposit means you’re only putting down 5% of that 40% share, not the full property value. That’s a huge difference. You can also increase your share over time through staircasing, and once you own 100%, the rent stops and you own the property outright.
First Homes is a newer England-only scheme that offers new-build apartments at a discount of at least 30% off the market price, sometimes up to 50%. The discount is set by the local authority and stays with the property permanently — so when you sell, the next buyer also gets the discount. There’s a price cap of £250,000 after the discount (or £420,000 in London), and you need to be a first-time buyer with a household income of £80,000 or less (£90,000 in London).
The Lifetime ISA is simpler than both. You open a cash or stocks and shares Lifetime ISA, save up to £4,000 per tax year, and the government adds a 25% bonus — up to £1,000 free per year. The catch is that the account must be open for at least 12 months before you can use the money to buy a home, and the property must cost £450,000 or less. If you withdraw for any other reason, you lose the bonus plus some of your own savings through a 25% penalty.
The Mortgage Guarantee Scheme works behind the scenes. You don’t apply to it directly — you just apply for a 95% mortgage with a participating lender, and the government guarantees part of the loan. This scheme was made permanent in July 2025, replacing the temporary version that had already helped complete over 53,000 mortgages. It’s available on properties up to £600,000 and is open to both first-time buyers and home movers.
Why these schemes matter more than ever for apartment buyers
Here’s the reality: 81% of UK adults now say that getting on the property ladder is one of their top housing concerns, and house prices are the other big worry at the same 81% figure. That’s not just a statistic — it’s the reason these schemes exist. They’re designed to address exactly those two problems: the deposit hurdle and the price barrier.
Let me give you a concrete example. Say you’re looking at a new-build apartment in Manchester priced at £200,000. Through First Homes, if the local authority has set a 30% discount, you’d pay £140,000. Your deposit at 5% would be just £7,000. Compare that to the full £10,000 deposit you’d need without the discount, and you’re already £3,000 better off before you even move in. The discount also means your monthly mortgage payments are lower, which matters when interest rates are unpredictable.
What I tend to notice is that people assume these schemes are only for houses or only for people in London. That’s not true. Shared Ownership is available nationwide through housing associations, and it covers both new-build and resale apartments. First Homes is England-only but applies to any eligible new-build, including flats. And the Lifetime ISA works across the whole UK, as long as the property is under £450,000.
There’s also a regional dimension worth knowing about. Scotland has the First Home Fund (offering up to £25,000 as a shared equity loan) and LIFT schemes. Wales offers Help to Buy – Wales with a shared equity loan of up to 20% on new-builds up to £300,000. Northern Ireland has the Co-Ownership scheme, which works similarly to Shared Ownership. If you’re buying outside England, check your local scheme first — it might be better suited to your market.
Where buyers trip up — and how to avoid it
I’ve seen the same mistakes come up again and again. Here are the ones that cost people the most time and money.
Not planning the Lifetime ISA 12-month window
This is the most common error. People open a Lifetime ISA, start saving, and then try to buy a home nine months later — only to find they can’t use the money because the account hasn’t been open for a full year. The 12-month clock starts when you open the account, not when you make your first deposit. If you’re even thinking about buying in the next two years, open a LISA now. Even £1 will start the timer. And remember: you can’t use the Lifetime ISA bonus alongside the old Help to Buy ISA bonus on the same property, so if you have both, you’ll need to choose one.
Assuming Shared Ownership means you own nothing
Some buyers worry that Shared Ownership is just renting with extra steps. It’s not. You own your share outright — you can sell it, you can staircase to a larger share, and eventually you can own 100%. The key is understanding that you’re a homeowner, not a tenant. You’ll still need to budget for service charges and maintenance fees, especially in leasehold apartments, but the equity you build is real. If you’re unsure about the legal side of things, it’s worth speaking to a property lawyer who can walk you through the lease terms before you commit.
Overlooking the First Homes price cap
The First Homes scheme caps the price after the discount at £250,000 outside London and £420,000 in London. If the apartment you’re looking at is priced at £260,000 after the 30% discount, it doesn’t qualify — even if the discount itself is generous. Always check the cap first, not the discount percentage. Local authorities can also add extra eligibility criteria, like prioritising key workers or people with a local connection, so don’t assume you qualify just because you meet the income threshold.
Ignoring the Mortgage Guarantee Scheme’s permanence
The original Mortgage Guarantee Scheme was temporary and closed in June 2025. But a new permanent version launched in July 2025, sometimes called the Freedom to Buy scheme. Many buyers don’t realise it’s still available and assume 95% mortgages are hard to find. They’re not — the scheme encourages lenders to offer them, and over 53,000 mortgages have already been completed through it. You don’t apply to the scheme; you just find a participating lender and apply for a 95% mortgage normally.
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| Scheme | What you get | Key limit |
|---|---|---|
| Shared Ownership | Buy 25–75% share, pay rent on rest | Income £80,000 or less (England) |
| First Homes | 30–50% discount on new-build | Price cap £250k (£420k London) |
| Lifetime ISA | 25% government bonus on savings | Property must cost £450,000 or less |
| Mortgage Guarantee | 5% deposit mortgages available | Property up to £600,000 |
Your practical guide to using these schemes for an apartment purchase
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Check your eligibility first — it saves wasted effort
Before you fall in love with an apartment, check whether you qualify for the schemes in your area. For Shared Ownership, your household income must be £80,000 or less in England, and you need to be a first-time buyer or a previous homeowner who can’t afford to buy now. For First Homes, the income cap is the same, but it rises to £90,000 in London. The Lifetime ISA has no income cap, but you must be aged 18–39 to open one, and the property must be your first home and cost £450,000 or less. The Mortgage Guarantee Scheme has no income cap at all — it’s open to anyone buying a property up to £600,000.
My advice: start with the Lifetime ISA if you’re under 40 and haven’t opened one yet. The 25% bonus is free money, and the 12-month clock means you should start it even if you’re not sure when you’ll buy. If you’re over 39 or need a bigger discount on the purchase price, Shared Ownership or First Homes are better bets.
Compare Shared Ownership and First Homes for your budget
These two schemes serve different purposes. Shared Ownership lets you buy a share of an apartment and pay rent on the rest, which means lower upfront costs but ongoing rent payments. First Homes gives you a permanent discount on the full purchase price, so you own 100% from day one with no rent, but you’re limited to new-build properties in England.
If you’re buying in a city where new-build apartments are common — Manchester, Birmingham, Leeds — First Homes is worth a serious look. If you’re looking at resale apartments or want more flexibility on location, Shared Ownership is probably the better fit. You can also combine the Lifetime ISA with either scheme, as long as the property meets the LISA’s £450,000 cap.
Understand the Right to Buy if you’re a council tenant
If you’re a council tenant in England, you may be able to buy your home at a discount through the Right to Buy scheme. The maximum discount is £102,400 for a house outside London, or £136,400 in London. You need to have been a tenant for at least three years, and the typical discount ranges from 35% to 70% depending on how long you’ve lived there. If you sell within five years, you may have to repay some or all of the discount. Housing association tenants may qualify for a similar scheme called Right to Acquire.
This is one of those schemes that people assume is only for houses, but it applies to flats too. If you’re renting a council apartment and want to buy it, check your eligibility — the discount could make it far cheaper than buying on the open market.
Plan for the future: staircasing and selling
If you use Shared Ownership, think about how staircasing works before you buy. Each time you buy a larger share, you’ll need a new valuation and potentially a new mortgage. The rent on the remaining share is typically around 2.75% of the housing association’s share, so as you staircase, your rent decreases. Once you own 100%, the rent stops entirely and you own the property outright.
For First Homes, remember that the discount stays with the property permanently. When you sell, the next buyer also gets the discount, which means your sale price will be lower than the market value. That’s fine if you’re planning to stay long-term, but if you think you might move in a few years, factor that into your decision.
- 1Open a Lifetime ISA todayEven if you’re not buying for two years, open a LISA with £1 to start the 12-month clock. You can save up to £4,000 per year and get a 25% government bonus.
- 2Check your eligibility for Shared Ownership or First HomesVisit your local housing association’s website or the government’s Own Your Home portal. You’ll need proof of income and ID.
- 3Find a participating lender for a 95% mortgageMost major high street banks offer 95% mortgages through the Mortgage Guarantee Scheme. Compare rates online or speak to a mortgage broker.
- 4Get legal advice on the lease and scheme termsShared Ownership apartments are usually leasehold, so you’ll need a solicitor to review the lease, service charges, and staircasing terms. A property lawyer can help you avoid costly surprises.
Frequently asked questions
Can I use the Lifetime ISA and Shared Ownership together? ▾
What happens if I need to sell my Shared Ownership apartment? ▾
Is the First Homes discount really permanent? ▾
Can I buy an apartment through the Mortgage Guarantee Scheme if I’ve owned before? ▾
What if I live in Scotland, Wales, or Northern Ireland? ▾
Do I need a survey for a Shared Ownership apartment? ▾
Your next move
The single most useful thing you can do right now is open a Lifetime ISA if you’re under 40. The 25% bonus is free money, and the 12-month clock won’t start until you do. After that, check your eligibility for Shared Ownership or First Homes — both are active, funded, and designed for exactly your situation. Don’t let the jargon put you off. These schemes exist because the market is hard, and they work.
If this was useful, you might also want to read apartment buying regrets UK buyers wished they knew sooner.
Sources and Further Reading
Essential tax tips for buying an apartment in the UK — A practical guide to the tax implications of buying a flat, including stamp duty and capital gains considerations.
Is a new-build apartment right for you? — Weighs the pros and cons of new-build flats, including how schemes like First Homes apply.
Government schemes for first-time buyers. Clearview Mortgage, 2025.
Government schemes to help you buy a home. HomeOwners Alliance, 2025.
Help to Buy schemes 2026. Mortgage Calc UK, 2025.
