First-Time Buyer Guide UK 2026 — Everything You Need to Know
Buying your first home is exciting and terrifying in equal measure. This guide walks you through every step — from saving a deposit to picking up the keys — with real numbers and practical advice for the 2026 market.
How Much Deposit Do You Need?
The minimum deposit for most lenders is 5%of the property price. On a £250,000 home that is £12,500. However, putting down more unlocks better interest rates:
| Deposit | LTV | Typical 2-year fix (2026) |
|---|---|---|
| 5% | 95% | 5.0 – 5.5% |
| 10% | 90% | 4.5 – 5.0% |
| 15% | 85% | 4.0 – 4.5% |
| 25%+ | 75% | 3.5 – 4.2% |
Every 5% you add typically saves 0.2 – 0.5% off your interest rate, which on a £200,000 mortgage could mean £50 – £80 less per month.
Government Schemes for First-Time Buyers
Lifetime ISA (LISA)
Save up to £4,000 per year and the government adds a 25% bonus (£1,000 free per year). Available to 18–39 year olds. Property must be under £450,000. Maximum total bonus: £33,000 if you start at 18.
First Homes Scheme
New-build homes sold at 30–50% below market value to local first-time buyers. The discount stays with the property forever. Price cap of £250,000 after discount (£420,000 in London). Household income must be under £80,000 (£90,000 in London).
Shared Ownership
Buy 25–75% of a property and pay rent on the rest. Lower deposit needed (5% of your share, not the full price). See our shared ownership guide for the full breakdown.
Stamp Duty for First-Time Buyers
First-time buyers in England and Northern Ireland pay no stamp duty on the first £425,000 of a property priced up to £625,000. Above that threshold, you pay 5% on the portion between £425,001 and £625,000. If the property costs more than £625,000, you lose the relief entirely and pay standard rates.
Use our free Stamp Duty Calculator on CalcPad to see exactly what you would owe.
Getting Your First Mortgage
Lenders typically offer 4 to 4.5 times your annual salary. On a £35,000 salary that means roughly £140,000 – £157,500. On a combined income of £60,000, you could borrow £240,000 – £270,000.
Before you apply:Clear credit card balances. Cancel unused credit accounts. Register on the electoral roll. Avoid applying for new credit in the 3 months before. Check your credit report on Experian, Equifax and TransUnion — all three, because lenders use different ones.
Decision in Principle (DIP): Get this before house hunting. It is a soft credit check that confirms what a lender would offer you. Estate agents take you more seriously with one. Takes 15 minutes online.
See what your monthly payments would look like with our Mortgage Calculator on CalcPad.
The Buying Process: Step by Step
- Save your deposit — Use a LISA to boost it. Set a target based on realistic local prices.
- Get a Decision in Principle — Valid for 60–90 days.
- Find a property — Rightmove, Zoopla, OnTheMarket. View at least 10 before making an offer.
- Make an offer — Start below asking price. The 2026 market has more room to negotiate than 2021–2022.
- Instruct a solicitor — Budget £1,000 – £2,000. See our conveyancing guide.
- Submit your full mortgage application — Provide payslips, bank statements, ID, and proof of deposit.
- Get a survey — Always get your own, separate from the lender valuation. See our survey guide.
- Receive your mortgage offer — Usually 2–4 weeks after application.
- Exchange contracts — You are now legally committed. Pay the exchange deposit (usually 10%).
- Complete — The money transfers, you get the keys. Welcome home.
Typical timeline: 8–14 weeks from offer accepted to keys in hand.
Total Costs to Budget For
| Cost | Amount |
|---|---|
| Deposit | 5–25% of price |
| Solicitor fees | £1,000 – £2,000 |
| Survey | £300 – £1,500 |
| Mortgage arrangement fee | £0 – £2,000 |
| Stamp Duty | £0 if under £425k |
| Moving costs | £500 – £2,000 |
| Furniture / essentials | £2,000 – £5,000 |
Rule of thumb: budget an extra £5,000 – £10,000 on top of your deposit for all the other costs.
Common First-Time Buyer Mistakes
Not getting a survey. A £400 survey could uncover £20,000 of hidden problems. Always get one.
Maxing out your budget. Just because a lender offers you £250,000 does not mean you should borrow it all. Leave room for rate rises and unexpected costs.
Ignoring the area. Visit at different times of day. Check flood risk maps. Look at local school ratings even if you do not have children — it affects resale value.
Skipping the broker. A whole-of-market mortgage broker can access deals you cannot find direct. Many are fee-free.
Forgetting about leasehold. If buying a flat, check the remaining lease length (under 80 years is a problem), ground rent, and service charges.
Last updated May 2026. This guide is for general information only. Always seek independent financial advice before making property decisions.