If you’re a key worker and a first-time buyer, you will likely be interested in the key worker housing schemes that are available to somebody in your position
Previously, the Key Worker Living Programme gave people in the relevant professions the opportunity to get their feet on the property ladder. Unfortunately, this ended in 2019 but there are alternatives. To find out what is available in your area, check with your local housing associations and social landlords, as well as your local council, for more information.
Below are just a few of the key worker mortgage schemes and key worker housing schemes that are available to many key workers within the UK. Applicants must be in permanent employment (or be temporary workers with 6 months on their contract and the likelihood of contract renewal) and have the finances available to purchase a mortgage.
Read our guide and then get in touch with a mortgage broker at YesCanDo Money if you need further information on mortgage advice for key workers.
Key worker housing scheme & mortgages
Below we list 6 of the top housing and mortgage schemes for key workers.
When it was set up, the aim of the Right-To-Buy scheme was to build an affordable rental house in place of every house sold to give qualifying people the opportunity to purchase their home at a discounted rate.
This social housing scheme was originally available to people throughout the UK but it is no longer active in Scotland and Wales.
With the scheme, the longer you live in your council home, the greater your discount becomes. So, even if you don’t have the means to buy your council house at an early date, you may still be able to buy your home at less than the market value at some point in the future.
You are eligible to apply to buy your council home if you have spent at least 3 years as a secure council tenant (the 3 years don’t have to be continuous). The property needs to be your main home and you need to have a public sector landlord, such as a council, housing association, or NHS trust.
Suitable for: This is a suitable scheme for anybody who no longer wants to pay rent on their council property.
2. Help-To-Buy Equity Loan Scheme
Unfortunately, as of October 31st 2022 this scheme no longer takes new applications and has come to an end for the foreseeable future. We leave the information in place for reference purposes only.
Help-To-Buy was a government-backed equity loan scheme primarily aimed at first-time buyers wanting to get on the property ladder. With the scheme, the government would give you an equity loan of up to 20% of the total house price of the property you are considering (or 40% if you’re in London).
To be eligible for this type of convenient borrowing, you needed a minimum 5% deposit for your mortgage. The loan can be used to boost your deposit so you may be able to access better mortgage deals with lower interest rates, depending on your circumstances.
This government loan scheme was only given to people wanting to buy a new build home that does not exceed £60,000. As such, you could not buy a property that had been lived in by other people or that goes over this price.
The help to buy equity loan scheme was an affordable way to buy a home and you could pay it back at any time before the end of your equity loan term.
Suitable for: First-time buyers who are able to pay the 5% deposit and monthly loan repayments. (Let’s hope to see more amazing schemes like this in the future.)
3. Shared Ownership
Shared ownership is another government-backed scheme to help people buy their first property. It allows them to buy an initial share of the property’s value, from 25% to 75%, while paying rent to their housing association on the portion that they don’t own.
Shared ownership is an affordable way to purchase a home although you would need to budget as you will have to pay rent and your mortgage payments each month. The shared ownership scheme is available on both new build and second-hand properties (owned by the housing association) and you can keep buying further shares in the property until it is completely yours.
Suitable for: The shared ownership scheme is for any potential buyer that doesn’t own a home.
4. Homebuilders Discounts
Some home builders will offer a discount (usually up to 5%) on new build homes for key workers. They will have their own criteria for key worker housing eligibility so you should contact the relevant building companies in your local area for further information.
Suitable for: Those looking for an alternative to key worker schemes offered by their local government or housing associations.
5. First Homes Scheme
First Homes is a key worker scheme to help first-time buyers and key workers to purchase their first property. Purchasers must live in the local area and must also have a household income that doesn’t exceed £80,000 (£90,000 in London.).
Homes are offered at a discount of at least 30% compared to the open market price and they are only offered to people living in England.
The same percentage of the discount will be passed on with the sale of the property to future first-time buyers so the home will always be sold below market value, therefore benefitting local communities for years to come.
First Homes aren’t available everywhere at the moment but 1500 are being rolled out over the next 2 years on construction sites around the country. If you’re interested in this key worker housing scheme, you should contact your local council to find out about availability in your area.
Suitable for: Local first-time buyers and key workers who meet the eligibility criteria needed to purchase a First Home.
6. 95% Mortgages
This government-backed mortgage guarantee scheme is designed to help first-time buyers or current homeowners secure a mortgage with just a 5% deposit to buy a home on the local housing market that is worth up to £60,000.
The government and various building firms have contributed to an indemnity fund which has been set aside to reimburse lenders should they lose money if the buyer goes into arrears. By supporting lenders in this way, all kinds of people that wouldn’t have been able to get a mortgage otherwise can now be given the opportunity to purchase their own home.
Suitable for: Prospective buyers who want to buy a property with a smaller deposit.
Having been established for over 40 years our expert mortgage advisors have a wealth of experience with all types of housing schemes and their criteria for acceptance. It’s been our observation that a ten-minute chat can be beneficial in ascertaining the options open to you. –
Frequently Asked Questions
A key worker (also known as a critical worker or essential worker) is a public or private sector employee that provides an essential service. They can work for local authorities and in fields such as health and social care, education, and public safety.
Key workers are the people that are often called upon to work during emergencies, such as doctors and nurses.
We have listed various government housing initiatives above, each of which can give key workers in certain eligible organisations the opportunity to buy their own homes at a discount.
Some government schemes, such as the First Homes scheme, have been specifically set up to help key workers move into affordable housing.
Other than the government housing initiatives listed, you should also check for other housing and mortgage schemes that help buyers purchase properties at a discounted rate.
Some local authorities run their own key worker schemes and private housing developers run their own initiatives too. To see if such a scheme is available in your local area, have a look online and contact local developers, your local councils, and any available housing associations in your location.
A mortgage broker will also be able to advise you on the key worker mortgage schemes and government loan schemes that you could be eligible for.
How YesCanDo Money Can Help you get on the Property Ladder
If you want to buy a home for a reduced outlay using a key worker housing scheme, get in touch with an experienced mortgage adviser in key worker mortgages at YesCanDo Money.
After booking an initial appointment with a mortgage advisor, you will be given an appointed representative who will talk to you about the government-backed guarantee housing schemes that may be available to you. Once you have learned of the existence of such schemes, you will be able to choose from the eligible organisations that are right for your financial circumstances.
Once you have picked a suitable first-time buyer or key worker scheme, you then need to apply for a mortgage. This can be a complex process but your appointed mortgage broker will be experienced with key workers and their options and will be with you every step of the way, helping you get a good deal before supporting you with your mortgage application.
Our primary aim is to help you save money so not only will we point you toward the mortgage schemes that are right for you, but we will also give FEE-FREE mortgage advice and support, with no hidden fees or charges.