What does the Budget mean for the housing market?

The Budget includes some welcome announcements for the housing market, with new support for first-time buyers taking centre stage. Here’s what’s been announced, what it could mean if you’re thinking of moving, and where to find out more. 

Your First Home scheme officially announced for first-time buyers

When it comes to housing, the headline announcement in the Budget is the launch of Your First Home, a new government scheme designed to help first-time buyers in England overcome one of the biggest barriers to buying: saving up a deposit.

The government announced the scheme in September, with more details around eligibility announced today. 

Here are some of the main things to know. 

Your First Home is a new equity loan scheme for first-time buyers purchasing a new-build home from a developer taking part in the scheme. 

The scheme will allow eligible buyers to purchase with a 2.5% deposit, alongside a 20% government-backed equity loan. The equity loan will have an initial interest-free period of 5 years, but there are regional and income price caps people will need to consider first. You can check what you could afford under the Your First Home scheme using our calculator.

“Today’s confirmation of the Your First Home scheme is a positive step for first-time buyers, particularly at a time when affordability remains challenging. The average two-year fixed mortgage rate is currently 5.54%, up from 4.25% before the war in Iran started, adding significantly to monthly mortgage costs. 

The scheme has the potential to give more first-time buyers a route into home ownership, while also providing an important boost to the new-build market,” says Alex Slater, Rightmove’s Director of New Homes. 

Want the full details on what we know so far? Read our complete guide to Your First Home. 

What else did the Budget say about housing?

While the Your First Home scheme is the headline announcement for first-time buyers, here are the other key announcements from the Budget that could matter if you’re buying a home, own a home, or rent one: 

• £100 energy bill payment for eligible households: Households in council tax bands A–D in England are set to receive a £100 Household Energy Payment, paid from January 2027. You can check your council tax band here

• Lifetime ISA withdrawal charge reduced from 25% to 20%: From 29 October 2026, eligible first-time buyers purchasing a property above the £450,000 Lifetime ISA cap will pay a lower withdrawal charge. This means they can retain more of their savings when buying a home above the threshold, although a charge will still apply

• Scrapping the cut to tax-free Cash ISA allowances: the planned cut from the tax-free savings caps of £20,000 to £12,000 will not go ahead. So, if you’re saving for a deposit you could put an extra £8,000 a year into a Cash ISA without paying tax on the interest

• Higher tax rates on landlords’ property income: From 6 April 2027, tax rates on property income will increase by a further two percentage points, taking them to 24% for basic-rate taxpayers, 44% for higher-rate taxpayers and 49% for additional-rate taxpayers in England, Wales and Northern Ireland

What could the Budget mean for the housing market?

Although government announcements could influence people’s moving decisions, they’re only one part of what influences the housing market. Affordability for first-time buyers, mortgage rates, the number of homes available, and local supply and demand can all make a difference. Keep up to date with the latest housing market news with our monthly House Price Index.  

Find out more about the Your First Home scheme

Please note: Your home may be repossessed if you do not keep up repayments on the mortgage. Rightmove is not authorised to give financial advice; the information and opinions provided in these articles are not intended to be financial advice and should not be relied upon when making financial decisions. Please seek advice from a regulated mortgage adviser.   

Source: Budget 2026, HM Treasury