If you are planning to buy a home, one of the first questions you are likely to ask is: how much deposit do I need for a house? The amount you need will depend on the property price, the mortgage you qualify for, the type of buyer you are, and the lender you choose.
In many cases, buyers need a deposit of at least 5% of the property price, although putting down a larger deposit can give you access to more mortgage options and potentially lower interest rates.
Understanding how house deposits work can help you set a realistic savings target and prepare for the other costs involved in buying a property.
What Is a House Deposit?
A house deposit is the amount of money you contribute towards the purchase price of a property yourself. The remainder is normally funded through a mortgage.
For example, if you want to buy a house for £250,000 and have a 10% deposit, you would contribute:
£250,000 × 10% = £25,000
You would then need a mortgage of approximately £225,000, assuming there are no other adjustments to the purchase price.
The deposit is different from the other costs of buying a house, such as solicitor's fees, mortgage fees, surveys, moving costs and, where applicable, Stamp Duty.
How Much Deposit Do I Need to Buy a House?
For many UK buyers, a 5% deposit is often considered the minimum starting point for a standard residential mortgage. However, this does not mean that every buyer will be able to obtain a mortgage with only 5% down.
Typical deposit levels include:
| Deposit | Example on a £250,000 house |
|---|
| 5% | £12,500 |
| 10% | £25,000 |
| 15% | £37,500 |
| 20% | £50,000 |
| 25% | £62,500 |
A larger deposit reduces the amount you need to borrow. It can also improve your loan-to-value ratio, which may give you access to a wider range of mortgage products.
Is a 5% Deposit Enough for a House?
A 5% deposit can be enough for some mortgage products, particularly for eligible first-time buyers. However, there are several factors to consider before deciding that 5% is your target.
With a 5% deposit, you would generally need to borrow around 95% of the property's value. This is known as a 95% loan-to-value (LTV) mortgage.
For example, on a £300,000 property:
5% deposit = £15,000
Mortgage = £285,000
LTV = 95%
Because you are borrowing a larger proportion of the property's value, your mortgage options and interest rate may differ from those available to someone with a 10%, 15% or 20% deposit.
Is a 10% Deposit Better?
Saving a 10% deposit can make buying a house more flexible.
A 10% deposit means you would normally need a mortgage of 90% of the property's value. Some lenders offer more mortgage products at lower LTV levels, so increasing your deposit may improve your choice of deals.
For a £300,000 house, a 10% deposit would be £30,000, leaving a mortgage requirement of £270,000.
However, saving an extra £15,000 simply to reach 10% may not always be the best financial decision. You also need enough money to cover your buying costs and maintain an emergency fund.
Does a Bigger Deposit Mean a Cheaper Mortgage?
A larger deposit can potentially make your mortgage cheaper, but it is not simply because you have paid more upfront.
The key factor is your loan-to-value ratio. A lower LTV means you are borrowing less relative to the property's value, which can make you a lower-risk borrower from the lender's perspective.
For example:
5% deposit → 95% LTV
10% deposit → 90% LTV
15% deposit → 85% LTV
20% deposit → 80% LTV
25% deposit → 75% LTV
Depending on the mortgage market, moving into a lower LTV bracket may give you access to more competitive mortgage rates.
How Much Deposit Do First-Time Buyers Need?
First-time buyers do not necessarily need a huge deposit. Some mortgage products are available with deposits starting at 5%, subject to eligibility and the lender's criteria.
However, first-time buyers should think beyond the minimum deposit.
Suppose you are buying a £250,000 house and plan to put down a 5% deposit. You would need £12,500 for the deposit. But you may also need money for:
Solicitor and conveyancing fees
Mortgage-related fees
Property survey
Mortgage broker fees, if applicable
Removal costs
Buildings insurance
Furniture and other moving expenses
Stamp Duty, if applicable
This means your savings target should ideally be higher than the deposit alone.
How Much Deposit Do I Need for a £200,000 House?
The deposit depends on the percentage you plan to put down.
For a £200,000 property:
5% deposit: £10,000
10% deposit: £20,000
15% deposit: £30,000
20% deposit: £40,000
25% deposit: £50,000
Your income, credit history, existing debts and the lender's affordability assessment will also influence how much you can borrow.
How Much Deposit Do I Need for a £300,000 House?
For a £300,000 house, the figures would be:
5%: £15,000
10%: £30,000
15%: £45,000
20%: £60,000
25%: £75,000
If you are struggling to save a large deposit, it may be worth looking at properties at a lower price rather than borrowing more than you can comfortably afford.
Can I Buy a House Without a Deposit?
A traditional mortgage normally requires the buyer to contribute some money towards the purchase. However, there have been mortgage products and schemes that reduce the amount of cash a buyer needs upfront.
A 100% mortgage can, in some circumstances, allow an eligible buyer to purchase a property without a traditional cash deposit. These products are not available to everyone and may have specific eligibility requirements.
Even if a mortgage does not require a deposit, you should still consider the other costs associated with buying a property.
Can My Family Help With My House Deposit?
Family members may be able to help with a house deposit, depending on the mortgage lender's rules.
For example, parents or other relatives might provide money as a gift. Some lenders will require a written declaration confirming that the money does not need to be repaid and that the donor will not have an ownership interest in the property.
There are also arrangements such as family-assisted mortgages, although the exact requirements vary between lenders.
If someone else is providing your deposit, check the lender's requirements before transferring the money.
Can I Use a Lifetime ISA for a House Deposit?
Eligible first-time buyers may be able to use savings from a Lifetime ISA (LISA) towards buying their first home.
A LISA allows eligible savers to receive a government bonus on qualifying contributions, subject to the applicable rules and limits. The property and buyer must meet the relevant conditions.
Because the rules surrounding Lifetime ISAs can affect when and how you can withdraw the money, it is important to understand the current requirements before relying on a LISA for your deposit.
How Long Does It Take to Save a House Deposit?
The time required to save a deposit depends on your income, expenses, existing savings and the price of the property you want to buy.
For example, if your target deposit is £30,000 and you can save £750 per month:
£30,000 ÷ £750 = 40 months
That is around three years and four months, before considering any interest earned on savings or changes to your target.
You may be able to reach your goal sooner by reducing expenses, increasing your income, using eligible government savings schemes or considering a less expensive property.
Should I Put Down the Biggest Deposit I Can?
Not necessarily.
It can be tempting to put every penny of your savings into your house deposit, but buying a home comes with unexpected expenses. You may need money for repairs, furniture, moving costs and emergencies after completion.
For this reason, it can be sensible to balance your deposit with an emergency fund.
A 20% deposit is not automatically better for every buyer if reaching that level would leave you with no cash savings.
What Other Money Do I Need to Buy a House?
Your deposit is only one part of the money required to purchase a property.
Depending on your circumstances, you may need to budget for:
Legal Fees
A solicitor or conveyancer handles the legal work involved in transferring the property into your name.
Survey Costs
A mortgage valuation is not necessarily the same as a detailed home survey. Depending on the property and your circumstances, you may want to arrange an independent survey.
Mortgage Fees
Some mortgage products have arrangement or product fees. Others may offer fee-free options with different interest rates.
Stamp Duty
Stamp Duty may apply depending on the property price, where you live, and your circumstances as a buyer. First-time buyer rules can also differ from those applying to other purchasers.
Moving Costs
Don't forget to budget for removals, storage, furniture and other expenses associated with moving home.
What Deposit Should I Aim For?
For many buyers, 10% is a useful target, because it can provide more mortgage options than a 5% deposit while still being more achievable than saving 20% or 25%.
That does not mean 10% is the right amount for everyone. Your ideal deposit depends on your financial circumstances.
A sensible approach is to work backwards:
Decide roughly how much you can afford to spend on a house.
Calculate 5%, 10%, 15% and 20% of that price.
Compare the mortgage payments at different deposit levels.
Estimate your buying costs.
Keep some savings available for emergencies.
Choose a deposit that does not put excessive pressure on your finances.
The Bottom Line
So, how much deposit do I need for a house? For many UK buyers, 5% can be a starting point, but saving 10% or more may provide greater flexibility and potentially better mortgage options.
The right deposit is not necessarily the biggest one you can afford. The goal is to find a balance between reducing your mortgage, accessing competitive mortgage products and keeping enough money available for the costs and unexpected expenses that come with owning a home.
Before making an offer, calculate the total cost of buying—not just the deposit—so you know exactly how much money you need to become a homeowner.