It’s hoped this will keep the price of new homes closer to regional first-time buyer average.
Housing secretary Robert Jenrick said: “The government is providing more ways to help families onto the housing ladder, and provide that life-changing moment when you get the keys to your own home.
“Alongside first homes, shared ownership and our £12bn investment in affordable housing, our new Help to Buy scheme will help thousands more families take their first step into a home of their own.”
Will German, director of Help to Buy at Homes England, added: “Help to Buy has already helped more than 270,000 people into home ownership and 82 per cent are first-time buyers.
“The new Help to Buy builds on this success with first-time buyers in front of mind.
“We’re pleased we can help homebuyers with smaller deposits to own a home, at a time where there are fewer options open to them.
“Housing, like most sectors, has experienced a slowdown during the Covid-crisis. But Help to Buy continues to give homebuilders the confidence to keep on building at a more crucial time than ever.”