What is the Save to Buy scheme and who is eligible for it?

One of the biggest challenges for aspiring homebuyers is to save for that all-important deposit, which can reach tens of thousands of pounds. 

If you’re renting and looking to get on the property ladder, this can be particularly difficult. 

A new scheme, Save to Buy, looks to help renters by channelling their monthly rental costs into savings for a deposit. 

We’ll have a look at how this new scheme works, its eligibility, and what you need to consider. 

What is the Save to Buy scheme, and how does it work?  

The Save to Buy scheme has recently been launched in London by Fairview New Homes after previously only being available in Essex.  

It’s designed to help first-time buyers afford their own property by allowing them to exchange contracts for only a 1% deposit (and a one-off reservation fee).  

You can then live in a new, energy-efficient property for up to two years for a fixed monthly cost, which goes towards your deposit instead of rent.  

All of Fairview’s new-build homes have a 10-year warranty.  

Once you are within one month of saving the 5% deposit you need, you can submit a mortgage application to buy the property – and when you complete, you’ll legally own your own home.  

How much will my monthly payments be? 

Your monthly payments will be based on your financial circumstances and the average local rent. 

You’ll also need to consider other costs associated with owning your own home, which Fairview can offer guidance on.  

How long will it take to save my deposit with the Save to Buy scheme? 

Fairview estimates that it’ll take between six months and a year to build a big enough deposit, but you can take up to two years if needed.  

You can also top up your monthly payments so you can buy your home faster.   

Who is eligible for the Save to Buy scheme? 

You can only apply for the Save to Buy scheme if: 

• You are a first-time buyer.
• You are employed.
• The property you’re planning to buy is your only residence.
• A recommended financial adviser has qualified you. 

The last one is vital as a financial adviser will outline what deposit you’ll need to save for and how much income is required. They can also get the necessary documents and do a credit check. 

If you’re looking for a financial adviser, Unbiased can quickly connect you with one. However, it’s worth checking with Fairview first to check their criteria, as Fairview must recommend your adviser.  

It’s also worth stressing that there are currently only two developments you can apply for: The Green at Epping Gate, Loughton and Dock28 in Woolwich. More developments are in the pipeline. 

How do I apply for the Save to Buy scheme? 

You’ll need to register your interest here to start the process.  

As Save to Buy is offered on a first-come, first-served basis and due to the limited availability of homes, it’s worth applying sooner rather than later if you’re interested. 

If there are no Save to Buy homes available, you won’t be able to apply.  

What are the pros and cons of the Save to Buy scheme? 

There are many advantages and disadvantages to consider before applying. 

The pros of the Save to Buy scheme include: 

• You only need a 1% deposit to exchange on a property.
• Your monthly payments go towards a 5% deposit instead of rent.
• You can live in the property before owning it. 

However, there are some noticeable cons to consider, such as: 

• You may likely end up with higher mortgage rates due to saving only a 5% deposit.
• New builds tend to come with a premium price tag compared to existing homes.
• You’ll likely have to pay leasehold and service rent costs, which can be pricey.
• It may not be ideal for those looking to move within a few years, as you should aim to build capital in your home. 

Learn more: what is the Own New Rate Reducer scheme, and how does it work?

Need help getting on the property ladder? 

Unbiased can quickly connect you with a qualified financial adviser who may be able to help you with the Save to Buy scheme. 

We can also help you find a local mortgage broker who can find the most competitive mortgage for your circumstances.