What we know about Burnham's "Your First Home" plan for first-time buyers

Prime Minister Andy Burnham has unveiled a Government-backed loan designed to help young people buy their first home, unveiling it on the eve of the Labour Party conference in Liverpool. The scheme, called "Your First Home", is the latest attempt by a UK government to close the gap between the deposits prospective buyers can save and the prices of newly built homes — a gap that has proved stubbornly persistent for more than a decade.

Under the plans, the scheme would be open to first-time buyers in England who can produce a deposit of just 2.5%. Rather than lending the money itself, the Government would provide an equity loan worth 20% of the value of the new-build property, helping those buyers cover the remainder of the purchase price. Burnham framed the intervention around young people without the financial backing of family, arguing that the "bank of mum and dad" has become an increasingly decisive factor in who gets onto the housing ladder.

Ministers have said the equity loan would carry an initial interest-free period, though the length of that period and the rest of the scheme's financial terms have not been confirmed. Burnham indicated that further detail would be set out in next month's Budget, when the Government is expected to provide more clarity on how the loan would be structured and repaid. Ministers have also declined to confirm whether buyers would face an age restriction, or whether the value of the property eligible for support would be capped.

On funding, the Government said money for the scheme is expected to come from reprioritising existing budgets, while housing developers would contribute towards its running costs. That detail drew immediate criticism from the opposition, who argued it amounts to a new levy on housebuilders at a time when construction is already struggling.

The Conservatives said the policy risked leaving first-time buyers taking on more debt, and warned it could feed into higher prices for new homes. Burnham, however, argued that too many young people are struggling with housing costs to the point where they have given up hope of ever owning a home of their own, and said the Government would step in to help more of them. He also claimed the scheme would give builders the "confidence" to deliver the high-quality new homes the country needs.

The proposal is not without precedent. It closely resembles the Help to Buy scheme launched in 2013 by then-Chancellor George Osborne during the Conservative-Liberal Democrat coalition, which itself expanded an earlier initiative called FirstBuy aimed specifically at first-time buyers. Help to Buy allowed all purchasers to put down a deposit of 5% on a newly built home valued at up to £600,000, with up to 20% of the property's cost funded through a shared equity loan that was interest-free for the first five years.

The first version of Help to Buy remained open until 2021. A second iteration, which ran until 2023, tightened the rules by limiting access to first-time buyers and applying regional price caps to the properties that could be bought through it. An official evaluation of the scheme found that more than 387,000 properties were purchased with its assistance, of which 328,000 were bought by first-time buyers.

The evaluation's conclusions were mixed. It judged the scheme effective at supporting people into home ownership in some areas, but said it had not removed affordability barriers for first-time buyers in parts of the country that were already relatively expensive — a finding that will likely shape how "Your First Home" is designed and targeted.

Housing Secretary Angela Rayner said the new scheme would build on the lessons of previous programmes while keeping their benefits. The Home Builders Federation, the trade body representing housebuilders, welcomed the announcement, noting that it had long pressed for action to improve access to home ownership. The federation said its own analysis showed a well-designed scheme could make a meaningful difference for households struggling to get onto the property ladder.

Conservative shadow housing secretary Katie Lam accused Labour of effectively wanting first-time buyers to borrow more in order to afford the small number of homes being built. She said taxpayers would end up holding a stake in people's homes and would be "picking up the bill" for months. Lam also said a further levy on developers risked pushing up new-build prices, and called the announcement a "colossal admission of failure", arguing that the Government was making homes harder to build before asking buyers to borrow more to pay for them.

The Conservatives said their own approach would involve scrapping stamp duty, backing British housebuilders, and ensuring homes are built in the places people actually want to live. The announcement comes as ministers acknowledge the scale of the challenge: Rayner said earlier this month there was only a "slim chance" the Government would hit its target of building 1.5m homes in England before the next election, while insisting she is not abandoning the goal.

Data published up to June suggested the Government is behind the pace of construction required to meet that target, which housebuilders have previously warned was too optimistic. BBC Verify analysis found the number of new homes being built declined during Labour's first year in power, extending a downward trend that began under the Conservatives.

Burnham arrived in Liverpool ahead of his first party conference as prime minister, saying he wanted it to be a significant week that sets out a new direction for the country. Referring to the period since Brexit, he said the country had seen a decade of drift and division, and that it was time to draw a line under it.

A second pre-conference announcement offered faster access to a guaranteed job for young people receiving health or disability support. Instead of waiting 18 months on universal credit — the current rule for jobless 18-to-24-year-olds under the Government's job guarantee — an offer would be made three months after a claimant first applies for benefits, with the change starting next April. Labour said the Government would cover 100% of wage costs for up to 25 hours a week for six months.

Conservative shadow work and pensions secretary Helen Whately said Labour should have reduced burdens on businesses to help disabled people find work. Instead, she said, the Government was reviving a Conservative scheme from after the pandemic, concluding that the prime minister "clearly has no new ideas".