Shared Equity Beyond Help to Buy: How Discount Market Sale and Regional Schemes Work in 2026

Life after Help to Buy

The Help to Buy equity loan scheme, which let first-time buyers borrow up to 20% (40% in London) of a new-build's value interest-free for five years, closed to new applications in 2023. For buyers looking at shared-equity routes into ownership since then, the main alternatives are discount market sale schemes, of which First Homes is the most widely available standardised version.

These schemes work fundamentally differently from Help to Buy: instead of an equity loan you eventually repay, you buy the home outright at a permanently discounted price, with the discount locked into the property title for all future sales.

How discount market sale works

A developer, often as a condition of planning permission (a Section 106 agreement), agrees to sell a proportion of new homes at a discount to open-market value — commonly to first-time buyers, key workers, or people with a local connection to the area.

Because you own the property outright (unlike shared ownership, where you buy a share and pay rent on the rest), there's no staircasing process and no rent payments — but the trade-off is a permanent cap on how much you can realise on resale.

First Homes: the standardised version

First Homes is the government's attempt to create a consistent national discount market sale product, replacing the patchwork of local Section 106 discount schemes with a single framework:

• Minimum 30% discount to market value (local authorities can require up to 50% in high-value areas)
• Restricted to first-time buyers with a household income cap (commonly £80,000, or £90,000 in London, though local variations exist)
• Priority often given to key workers and people with a local connection
• Maximum discounted purchase price caps apply in some areas
• The discount percentage is fixed at the point of sale and repeats on every future resale

Stamp Duty on discounted purchases

One underappreciated benefit: SDLT is calculated on the price you actually pay, not the full open-market value. For a home valued at £300,000 sold at a 30% discount for £210,000, stamp duty is assessed against £210,000 — potentially bringing the purchase within First-Time Buyer's Relief thresholds where it wouldn't otherwise apply.

The resale restriction — the part buyers underestimate

The single most important thing to understand about discount market sale is that the discount is permanent, not a one-off benefit you keep on resale. When you sell:

1. The property must be revalued at current open-market value.
2. The same discount percentage you received is applied again.
3. In First Homes specifically, the buyer pool for your resale is also restricted — you can generally only sell to another eligible first-time buyer under the same scheme rules.

This means if your home rises in open-market value from £300,000 to £400,000 and you have a 30% discount, you can sell for £280,000 (30% off £400,000) — not the full £400,000. You benefit from house price growth, but proportionally, and you never "escape" the discount by selling.

Comparing the routes

Mortgages for discount market sale properties

Not every high-street lender offers mortgages against discount market sale or First Homes properties, because the title restriction affects the property's marketability as security. Buyers should:

• Confirm early with a broker which lenders accept the specific scheme and local planning conditions
• Expect the mortgage to be assessed against the discounted purchase price, improving affordability
• Budget for potentially narrower product choice and, in some cases, slightly less competitive rates than the fully open mainstream market

Bottom line

With Help to Buy closed, discount market sale and its standardised First Homes variant remain a genuine below-market route into ownership for buyers priced out of the open market — offering full ownership (unlike shared ownership) at a locked-in discount, with real stamp duty savings. The trade-off is a permanent resale restriction that caps what you can realise and narrows your future buyer pool — a fair exchange for many first-time buyers, but one that should be understood in full before committing.