Mortgage schemes make homeownership more accessible, especially for our struggling key workforce. However, with the Key Worker Living (KWL) Programme ending in 2019, what mortgage schemes are available to key workers in 2025?
Teachers, doctors, nurses, firefighters, and the police keep our country running. Yet, while they provide vital services to society, with lower salary grades than in some other professions, they often struggle to secure a mortgage to finance their dream properties.
Fortunately, KWL is just one of many housing programmes. Below, we’ll share some of the best schemes and initiatives you can check out to help you afford your dream home as a key worker.
Who Are the Key Workers?
In the UK, the government recognises eight categories of key workers considered vital to the country’s functioning, health, and safety. These are the people often required to continue working in times of crisis, including:
- Health and Social Workers: Frontline health workers, such as doctors, nurses, midwives, paramedics, and those whose work involves public health and safety.
- Educators and Childcare Staff: Professionals responsible for education and childcare, like teachers, teaching staff, and social workers, belong in this category.
- Key Public Servants: People who work in the justice system, religious orders, non-profit organisations, death management, and public service broadcasting (e.g. journalists and broadcasters).
- Local and National Administrative Workers: Local and national personnel responsible for effective and prompt disaster response and essential public services.
- Food and Goods Producers and Distributors: People involved in the production, processing, distributing, selling, and delivering essential goods, such as food, hygiene, and medicine.
- Public Safety and National Security Personnel: This includes the police, fire and rescue, border patrol, National Crime Agency staff, prison guards, and other national security workers.
- Key Transport Workers: Individuals tasked with maintaining operations on water, air, road, rail, and freight transport, particularly in essential supply chains.
- Utilities, Communication, and Financial Staff: There are oil, gas, water, electricity, and waste disposal workers. This includes those employed in telecommunications, postal services, IT maintenance, and crisis response, like 111 and 999.
Best Mortgage Schemes For Key Workers
If you belong to any of those eight categories of key workers and are planning on getting your first property, you may qualify for the following mortgage schemes and get your feet on the property ladder:
First Homes Scheme
The First Homes Scheme was launched in June 2021. It allows first-time local home buyers and key workers in England to purchase new-build properties at a discounted price. Eligibility in this programme lets you enjoy 30% to 50% off the market price.
This initiative will help key workers buy properties in their area rather than move away from their workplaces due to increasing house prices.
How the First Homes Discount Works
Say you’re eyeing a new-build property with a market price of £150,000. If you qualify for the First Homes discount, you can instead buy it with a 30% discount of £45,000, which means you’ll only have to pay £105,000.
Whether you get the minimum 30% or a higher discount (up to 50%) depends on your local council’s discretion. But if you’re considered a key worker, you can make a case for a larger discount if it means you can serve your community better.
That said, once the discount is applied, it’ll remain locked into the property’s market price. So, if you ever decide to sell the house, the discount you receive when purchasing the property must be passed on to the next eligible buyer.
First Homes prices are capped at £420,000 after the discount is applied within London. Outside the Old Smoke, the property must not exceed £250,000.
How to Qualify For the First Homes Schemes
The First Home scheme is expected to add over 10,000 properties every year. However, as the programme’s name implies, not everyone is eligible for the discount.
You should be at least 18 years old. Those who already own a property, whether bought or inherited, will not be qualified for the scheme. Moreover, you must be a first-time homeowner who has only ever rented properties in England.
An annual income of less than or equal to £80,000 (before tax) is required to apply for the scheme. Inside London, this cap is increased to £90,000. Lastly, you should be able to get a mortgage to cover at least half the property’s price.
These rules apply whether you’re applying for the scheme by yourself or with others. Local councils could prioritise key workers, residents, and low-income families. Some exemptions might be given to present and former armed forces members and their spouses.
Shared Ownership
Shared Ownership is a scheme where you may purchase a share of the property from the landlord and only pay a reduced rent for the remaining share you don’t own. The landlord in this case is usually a local council or housing association.
This initiative will benefit key workers who can’t afford the entire deposit amount and mortgage payments. Shared Ownership rules can differ depending on whether you live in Wales, Scotland, or Northern Ireland.
How the Shared Ownership Scheme Works
People eligible for the Shared Ownership mortgage scheme may purchase between 25% and 75% of the property. Some landlords also sell as small as a 10% share.
The programme lets you buy several types of houses, such as new-build homes and second-hand properties sold through shared ownership resale. Individuals with long-term disabilities can purchase homes that meet their specific needs.
In terms of rent, the landlord can charge up to 3% of the value of the remaining property they still own—most charge 2.7%. For secondhand or “resale” houses, you’ll have to pay the same rate as the previous shared owners.
Rent will typically increase annually per your lease agreement.
You can buy more of the property after living in the Shared Ownership home for a certain period, also called “staircasing.” Tenants can typically purchase 10% additional shares or more at any time.
For people who bought their Shared Home after April 1, 2021, you might be eligible to purchase a 1% share every year for 15 years. The more shares you own, the less rent you’ll pay.
Before finalising your lease, check with your landlord to learn how much share, and in what intervals, you can purchase later. Some homes allow staircasing up to 100% of the property’s value.
How to Qualify For the Share Ownership Scheme
The Shared Ownership scheme primarily serves low-income families earning less than £80,000 annually who can’t afford mortgage payments and deposits. Some landlords could also require proof that you live or work in or near the property.
One of the following must also be true:
- You’re a first-time home buyer
- You’re starting a new household (e.g. after a divorce)
- You’re a shared home owner who wants to relocate
- You once owned a house, but you can’t afford one now
Those who own a home and are planning to relocate but can’t afford a home that meets their special needs may also apply for a Shared Ownership. Former and serving members of the armed forces are typically given priority for this scheme.
Right to Buy Scheme
While not exclusive to key workers, over two million properties have been sold to British homeowners through the Right to Buy (RTB) Scheme since its launch in the 1980s, according to the BBC.
Right to Buy is an initiative that allows tenants to purchase a council-built property at a discounted rate. The discount depends on the type of property you’re buying, its overall market value, location, and how long you’ve been a public sector tenant.
How the Right to Buy Scheme Works
Right to Buy provides different discounts for houses and flats. Tenants can get as much as a 35% discount on a house property, but they must live in a rented home for at least three years to qualify.
After five years, the maximum discount allowed increases by 1% every year you’re a public sector tenant.
Flats get a much higher discount rate than houses. If you’re purchasing a flat, you can get up to a 50% discount if you’ve been a tenant for at least 3 years. This rate also increases by 2% every year after five years.
If you’ve already used RTB in the past, you might only qualify for a smaller discount. Moreover, if you decide to sell the house or flat within five years, you may be required to refund a portion or all of the discounted amount.
The maximum discount rate for both instances is 70% of the total property’s value, but it may vary depending on the region.
How to Qualify For the Right to Buy Scheme
Only those who are considered “secure tenants” are eligible for the Right to Buy scheme. The house or flat should also be self-contained and your sole or primary residence.
You can only apply for a joint application with someone who shares your tenancy. They can also be relatives (up to three family members) who have lived with you for the last year, even if they don’t share your tenancy.
Your landlord must accept or decline your RTB application within four to eight weeks. If they refuse to sell, they should provide a sufficient reason for their refusal.
Final Thoughts: Getting a Mortgage as a Key Worker
Like many first-time property buyers, key workers find affordability a significant stumbling block to getting their dream property. They may struggle to prove they have enough income to cover future payments or enough savings to pay for the deposit.
If affordability is your main issue as a key worker, talking with our expert brokers can help you navigate your best mortgage options. While your finances aren’t favourable now, lenders may view your occupation positively for its security and career growth prospects.
Reach out to When the Bank Says No today, and let our expert advisors help you find specialist lenders and deals that suit your needs.