Buying your first home is one of the biggest financial decisions you will ever make. The UK property market can feel overwhelming, but with the right preparation you can navigate the process with confidence. This guide covers everything from saving a deposit to picking up the keys.
Am I Ready to Buy?
Before you start browsing Rightmove, run through this financial readiness checklist:
- Stable income — Most lenders want to see at least three months of payslips or two years of accounts if you are self-employed.
- Deposit saved — You need a minimum of 5% of the purchase price, though 10–20% unlocks better rates.
- Manageable debt — Lenders look at your debt-to-income ratio. Pay down credit cards and loans where possible.
- Good credit score — Check your credit report with Experian, Equifax, or TransUnion and fix any errors.
- Emergency fund — Keep three to six months of living expenses aside on top of your deposit.
- Affordable monthly payments — Use our mortgage affordability calculator to see what you can realistically borrow.
If you can tick most of those boxes, you are in a strong position to start the buying process.
How Much Deposit Do You Need?
The minimum deposit for most UK mortgages is 5% of the property price. On a £250,000 home, that means saving at least £12,500. However, the size of your deposit has a direct impact on the interest rate you are offered.
| Deposit | LTV ratio | Typical impact |
|---|---|---|
| 5% | 95% LTV | Higher rates, limited lender choice |
| 10% | 90% LTV | Noticeably better rates |
| 15% | 85% LTV | Access to more competitive deals |
| 20%+ | 80% LTV or lower | Best rates available |
Every 5% increase in your deposit can make a meaningful difference to your monthly repayments. Use our mortgage deposit calculator to see how different deposit amounts affect what you pay.
Government Help for First-Time Buyers
Several government-backed schemes exist to help you onto the property ladder.
Lifetime ISA (LISA)
The Lifetime ISA lets you save up to £4,000 per year and receive a 25% government bonus — that is up to £1,000 of free money each year. You must be aged 18–39 to open one and the funds can be used towards your first home (up to £450,000) or retirement. You need to have held the account for at least 12 months before using it.
First Homes Scheme
First Homes offers new-build properties to first-time buyers at a discount of 30–50% compared to market value. The discount is passed on to future buyers, keeping the properties affordable long term. Eligibility criteria apply, including household income caps.
Shared Ownership
Shared Ownership allows you to buy a share of 25–75% of a property and pay rent on the remainder. You can increase your share over time through a process called staircasing. This scheme is available through housing associations and is aimed at households earning £80,000 or less (£90,000 in London).
Help to Build Equity Loan
If you want to build your own home, the Help to Build Equity Loan provides an equity loan of 5–20% (40% in London) to help fund a custom or self-build project. You need a minimum 5% deposit.
Stamp Duty Relief for First-Time Buyers
First-time buyers in England and Northern Ireland benefit from generous stamp duty relief:
- No stamp duty on the first £425,000 of the purchase price for properties costing up to £625,000.
- On the portion between £425,001 and £625,000, you pay 5%.
- If the property costs more than £625,000, standard stamp duty rates apply to the full price with no first-time buyer relief.
Scotland and Wales have their own land transaction taxes with separate thresholds. Use our stamp duty calculator to work out exactly what you would owe.
Getting a Mortgage
Agreement in Principle
Before house hunting, get an Agreement in Principle (AIP) from a lender. This is a conditional statement confirming how much they would be willing to lend you based on a soft credit check. An AIP shows estate agents and sellers that you are a serious buyer. It typically lasts 60–90 days.
Types of Mortgage
- Fixed rate — Your interest rate stays the same for a set period (usually two or five years), giving you certainty over your monthly payments.
- Variable rate (tracker) — Your rate moves in line with the Bank of England base rate, so payments can go up or down.
- Discount variable — A discount off the lender’s standard variable rate for a set period.
Most first-time buyers choose a fixed-rate mortgage for the stability it provides. Run the numbers with our mortgage calculator to compare how different rates and terms affect your repayments.
Mortgage Broker vs Going Direct
A whole-of-market mortgage broker can search thousands of deals and often access rates not available to the public. Some charge a fee (typically £300–£500), while others are paid by the lender. Going direct to a bank limits you to that lender’s products only.
The Buying Process Step by Step
- Get an Agreement in Principle — Know your budget before you start looking.
- Find a property — Search online, visit viewings, and research the local area.
- Make an offer — Your estate agent submits the offer to the seller. Negotiate if needed.
- Instruct a solicitor — Once your offer is accepted, appoint a conveyancing solicitor to handle the legal work.
- Apply for your mortgage — Submit a full mortgage application with supporting documents.
- Arrange a survey — A survey checks the condition of the property and can identify potential issues.
- Exchange contracts — Both parties sign contracts and you pay your deposit. The sale is now legally binding.
- Completion — The remaining funds transfer, the seller hands over the keys, and the property is yours.
The process from offer accepted to completion typically takes 8–12 weeks, though delays are common.
Additional Costs to Budget For
The deposit is not the only upfront cost. Make sure you budget for:
| Cost | Typical range |
|---|---|
| Solicitor / conveyancing fees | £1,000 – £2,000 |
| Survey | £300 – £1,500 (depending on type) |
| Mortgage arrangement fee | £0 – £2,000 |
| Mortgage broker fee | £0 – £500 |
| Removal / moving costs | £300 – £1,500 |
| Building and contents insurance | From £150 per year |
| Furniture and initial repairs | Varies widely |
As a rule of thumb, budget an additional £3,000–£5,000 on top of your deposit to cover these costs.
Tips for First-Time Buyers
- Start saving early — Even small regular contributions add up, especially in a Lifetime ISA with the 25% bonus.
- Check your credit report — Do this at least six months before applying for a mortgage so you have time to fix any problems.
- Avoid big financial changes — Do not switch jobs, take out new credit, or make large unusual purchases in the months before your application.
- Get a proper survey — A basic mortgage valuation is not a survey. A HomeBuyer Report or Building Survey can save you thousands by uncovering hidden defects.
- Be prepared to negotiate — Sellers often accept below asking price, especially if you are chain-free as a first-time buyer.
- Do not stretch to your absolute maximum — Leave room in your budget for rate rises, maintenance, and the unexpected costs of homeownership.
Buying your first home takes patience and planning, but the reward is well worth the effort. Use our mortgage affordability calculator to start working out what you can comfortably borrow, and take the first step towards owning your own home.