Your First Impression: What Your First Home’s lukewarm reception tells us about managing expectations

When Your First Home was first announced in September, housebuilder shares jumped significantly. Then, following the details revealed in last week’s Budget, the sector index fell more than 6%. For communicators, this is a lesson in managing expectations.  

The initial communications about the scheme disclosed several important features: a 2.5% deposit, a 20% government-backed equity loan, new builds only, an initial interest-free period, household income caps and local property-price caps. But with the detail on what these caps would be and when the scheme would be introduced held back until the Budget, those gaps were inevitably filled with assumptions. The scheme was immediately compared to Help to Buy, which, across its lifespan, was used on around a third of all transactions on new-build schemes. 

The impact on share prices suggested that, in the City’s minds at least, Help to Buy was back. To be fair, this expectation wasn't entirely invented by the market: the government's own announcement, while saying that the scheme would “ensure support is targeted at those who need it”, also said it would provide a “much-needed stimulus to support the market and boost housing supply”. 

What emerged at the Budget, however, was more about targeted support than market stimulus. Unlike Help to Buy, Your First Home will, as its name suggests, be solely for first-time buyers, and household income caps (at £110,000 outside London and £140,000 in the capital) mean the scheme is more explicitly targeted at those who would struggle to purchase without assistance. Developers will be required to pay a levy to be part of the scheme, and the properties themselves must be new-build homes and will be subject to local price caps designed, in the government's words, to focus support on the types of more modest homes typically purchased by first-time buyers. The scheme will open for customer applications in February 2027, with the first property sales not expected to take place until April 2027. 

Government expects the scheme to help around 70,000 households in England and estimates that it will support the delivery of around 20,000 new homes. These are not insignificant numbers, but they are a far cry from the 387,000 purchases that Help to Buy supported between 2013 and 2023. 

Arguably it is these comparisons to Help to Buy, prompted or at least exacerbated by a phased release of detail, that have led to Your First Home’s lukewarm reception. However, while the scheme may have underwhelmed investors and housebuilders, it shouldn’t be seen as a failure. 

Help to Buy undoubtedly helped a lot of people, but an official report from the National Audit Office suggests that almost two-thirds of those who used the scheme could have bought a home without it. Some have also questioned the extent to which taxpayers’ money ultimately benefited developers and investors, while critics have argued that, by creating additional demand, the scheme contributed to higher prices, partially undermining the support it provided. Your First Home appears consciously designed to address at least some of those criticisms. 

With its local price caps, the scheme also fits with the government’s current agenda of ‘good growth in every postcode’. By reflecting local authority median prices, it acknowledges that affordability looks different in different parts of the country, showing a refreshing awareness that England consists of a wide range of communities with different economies and housing markets, rather than simply ‘London’ and ‘the regions’. 

Whether Your First Home ultimately succeeds will depend on much more than its launch communications. It needs buyers, lenders and housebuilders to participate and, most importantly, needs to help people who would genuinely otherwise struggle to buy a home. 

But there is already an interesting lesson in the way it was received: the government announced enough in September for people to recognise something that looked very much like Help to Buy, while leaving some of the details that would determine its scale until the Budget.  

Perhaps Your First Home should have been more clearly differentiated from its predecessor from the outset, with greater emphasis on the fundamental proposition: this was deliberately intended to be a more targeted intervention designed to avoid some of the Help to Buy scheme’s unintended consequences. 

Your First Home is unlikely to have much more than a modest impact on housing supply and, because of that, it has been branded by some as something of a damp squib. But this judgement is at least partly driven by a mismatch of expectations, and we should be careful about defining the scheme’s success purely by whether it delivers a Help to Buy-sized boost to housebuilders or the housing market. If it helps people across the country who would otherwise have struggled to get onto the property ladder, then it will be doing exactly what it was designed to do.