What is a deposit?
Your deposit is the chunk of money you put into the purchase yourself. The mortgage covers the rest. So if a property costs £250,000 and you have a £25,000 deposit, you would usually need a mortgage for the remaining £225,000.
Why the deposit matters
A bigger deposit can improve your options. It may give you access to better mortgage deals and lower monthly payments.
A smaller deposit can still get you on the ladder, but your monthly costs may be higher and your lender choices may be more limited.
5% deposit
Lowest cash upfront, but often fewer deals and higher monthly costs.
10% deposit
A common target for first-time buyers and usually gives you more choice.
15%+ deposit
Stronger position, better rates in many cases, and lower borrowing.
The bit buyers often miss
Your deposit is not the only cash you need. You may also need money for legal fees, surveys, moving costs, furniture, and a buffer after you move in. That is why buyers can hit their deposit target but still not feel fully ready.
How a Lifetime ISA (LISA) accelerates the deposit
A Lifetime ISA is the most powerful deposit-saving tool available to UK first-time buyers under 40. You can save up to £4,000 per tax year and receive a 25% government bonus on top — up to £1,000 free per year.
The catch: the money (plus bonus) can only be used toward a first home up to £450,000, or withdrawn from age 60. Use it for anything else and you lose 25% of the withdrawal (effectively about 6.25% of what you put in). For most under-40 first-time buyers, the bonus easily outweighs that lock-in risk — and the earlier you open one, the more bonus you collect.
Gifted deposits from family
Most UK mortgage lenders accept gifted deposits from immediate family. A gifted deposit is exactly what it sounds like — a gift, not a loan, with no expectation of repayment and no claim on the property.
Lenders need documentation: a signed gifted deposit letter from the gifter, proof of the gifter’s identity, and bank statements showing the source of funds. Anti-money-laundering rules apply, so don’t leave the documentation until the week of completion.
Worked example: 10% deposit on a £250,000 home
| Property price | £250,000 |
| Deposit (10%) | £25,000 |
| Mortgage | £225,000 |
| Stamp duty (FTB relief, England) | £0 |
| Solicitor + survey + fees | ~£3,000 |
| Removals + furniture + buffer | ~£3,500 |
| Total upfront cash needed | ~£31,500 |
Illustrative only. Solicitor, survey and removal costs vary by firm and location. Stamp duty depends on price and buyer eligibility.
A simple way to think about it
Deposit = getting through the front door.
Total cash plan = being able to afford everything around the move too.
Deposit FAQs
Quick answers to the questions UK first-time buyers most often ask about deposits.
How much deposit do I need to buy a house in the UK?+
Most UK first-time buyers aim for 5–20% of the property price. 5% is the minimum that mainstream lenders accept (via the government's Mortgage Guarantee Scheme); 10% is a common sweet spot for better mortgage choice and rates; 15–20% unlocks the best rates and the widest product range. On a £250,000 home that's £12,500 (5%), £25,000 (10%), or £37,500–£50,000 (15–20%).
Can I buy a house with a 5% deposit?+
Yes. 5% deposit (95% LTV) mortgages exist for first-time buyers in the UK, backed by the government's Mortgage Guarantee Scheme. Not all lenders participate, and the rates are usually higher than at 10% or 15% LTV. The trade-off: lower upfront cash but higher monthly cost and less product choice.
What is the average UK first-time buyer deposit?+
UK average first-time buyer deposits typically sit between £35,000 and £55,000 depending on year and region, with London substantially higher. The average reflects buyers in mid-priced areas; the actual amount you need depends entirely on what you're buying and where. Use the deposit calculator on this site for your specific target.
Should I save for a bigger deposit or buy now?+
Trade-off: a bigger deposit reduces your monthly cost and unlocks better mortgage rates, but every month you spend saving is a month of rent (and potentially rising property prices). For most first-time buyers, the sweet spot is hitting a 10% deposit and then prioritising buying rather than waiting indefinitely for 20%. Run both scenarios in the deposit calculator and compare.
What is a Lifetime ISA and how does it help with the deposit?+
A Lifetime ISA (LISA) lets UK first-time buyers aged 18–39 save up to £4,000 per tax year and receive a 25% government bonus on top — up to £1,000 free per year. The money (plus bonus) can be used toward a first home up to £450,000 anywhere in the UK. For most under-40 first-time buyers, opening a LISA early is the single highest-return move you can make on the deposit.
Can I use a gifted deposit from family?+
Yes. Most UK lenders accept gifted deposits from immediate family (parents, grandparents, sometimes siblings). The gifter typically needs to sign a gifted deposit letter confirming the money is a gift, not a loan, and that they have no claim on the property. The HomeReady gifted deposit planner walks through the documentation lenders require.
Does my deposit include stamp duty, solicitor fees and moving costs?+
No. Your deposit is what you put toward the property price — it reduces the mortgage you need. Stamp duty (where applicable), solicitor fees, survey, mortgage fees, removals, and basic furniture are all separate costs on top. Most first-time buyers spend £4,000–£10,000+ on these alongside the deposit, depending on price and choices.
What happens to my deposit at exchange and completion?+
At exchange of contracts, a portion of your deposit (typically 5–10%) is paid via your solicitor to the seller's solicitor — this is the legally binding commitment. The rest of the deposit is paid on completion day, together with the mortgage funds, to complete the purchase and transfer ownership. From exchange you're committed; pulling out usually means losing the deposit and potentially more.
What to do next
Once you know roughly what deposit level you are aiming for, the next step is to work out the numbers properly.
Use the calculator to estimate your target, then use the checklist to make sure the rest of your buyer plan is in place.