How Much Deposit Do I Need to Buy a House in the UK?
The short answer: 5% of the property price is the legal minimum, but most first-time buyers aim for 10–15% because rates are dramatically better. On a £250,000 home that's £25,000–£37,500 in cash you need to find before anyone hands you the keys.
This guide breaks down what you actually need at each deposit tier, how it affects your monthly payment, and the lesser-known ways to top up if you're short.
The minimum deposit by lender type
The UK mortgage market is structured around loan-to-value (LTV) bands. The LTV is the percentage of the property price you're borrowing — a 90% LTV mortgage means a 10% deposit. The lower the LTV, the lower the rate the lender will offer, because their risk is lower if house prices fall.
| Deposit | LTV | Availability | Typical rate (2024) |
|---|---|---|---|
| 5% | 95% | Limited (~70 lenders) | ~5.5% |
| 10% | 90% | Wide | ~5.0% |
| 15% | 85% | Very wide | ~4.7% |
| 25% | 75% | Best deals | ~4.4% |
| 40% | 60% | Premium | ~4.2% |
(Indicative rates only — see our pillar guide for current market context.)
The jump from 95% to 90% saves you the most money relative to deposit size. If you've already got £20,000 of a £25,000 deposit on a £250,000 house, finding the last £5,000 will save you tens of thousands over a 30-year term.
What 5%, 10% and 15% deposits actually look like
For a £250,000 home at 4.75% over 30 years (using our mortgage calculator):
| Deposit | Loan | Monthly payment | Total interest |
|---|---|---|---|
| £12,500 (5%) | £237,500 | £1,239 | £208,453 |
| £25,000 (10%) | £225,000 | £1,174 | £197,481 |
| £37,500 (15%) | £212,500 | £1,108 | £186,510 |
| £62,500 (25%) | £187,500 | £978 | £164,567 |
Going from a 5% to a 25% deposit saves you roughly £261 a month — over 30 years that's around £94,000.
What the lender actually accepts as a deposit
You can't just turn up with cash. The lender wants to see a paper trail and will reject anything that looks suspicious under anti-money-laundering rules. Acceptable sources:
- Your own savings — held in your name for at least 6 months
- Lifetime ISA — popular for FTBs because of the 25% government bonus. See our LISA guide.
- Help to Buy ISA (legacy, closed to new applicants but existing accounts still pay the bonus until 2030). See Help to Buy ISA explained.
- Gifted deposit from a parent, grandparent, or close family member, with a signed letter confirming it is a gift not a loan
- Inheritance, with grant of probate as evidence
- Sale of another asset (car, shares) with the bank statement showing the deposit
What lenders won't accept:
- A loan from a credit card or personal loan
- An undocumented cash deposit
- Foreign currency without strong source evidence
- A promise from a friend that's actually a loan
Government schemes that boost your deposit
Lifetime ISA
Save up to £4,000 a year, get a 25% government bonus on top — up to £1,000 free per year. Open it before you're 40, must be open at least 12 months before use, and the property must be under £450,000. Full mechanics in our Lifetime ISA guide.
Mortgage Guarantee Scheme
Government guarantees the slice between 80% and 95% LTV, encouraging lenders to offer 5% deposit deals. You don't apply directly — the scheme just exists in the background to make 95% mortgages more available.
First Homes scheme
A new-build at 30–50% off market price for local first-time buyers under 25 income brackets. You buy at the discounted price, and that discount is locked into the property forever (it passes to the next FTB owner). Limited availability — see first-time buyer schemes.
Shared ownership
Buy 25–75% of a property, rent the rest from a housing association. You only need a deposit on the share you're buying. On a £250,000 home where you buy 25%, your share is £62,500 — and a 5% deposit on that is just £3,125. Full breakdown: Shared ownership explained.
How much extra cash do you need beyond the deposit?
The deposit is not the only upfront cost. Budget for:
- Stamp duty: £0 for FTBs under £300,000 in England (post-April 2025), then 5% to £500,000. Above £500,000, full standard rates apply. See our stamp duty guide.
- Conveyancing fees: £1,000–£1,800
- Mortgage arrangement fee: £0–£2,000 (often added to the loan)
- Survey: £400–£1,200
- Removals: £400–£1,500
- Initial furniture / repairs: £1,000+
Rough rule: have another £3,000–£6,000 in cash beyond the deposit. The full list is in Fees you pay when buying a house in the UK.
Should you wait to save more or buy now?
This is the eternal debate. The argument for buying sooner with a smaller deposit:
- You stop paying rent (which builds nobody equity)
- House prices may rise faster than you can save
- Your borrowing power is set by salary, not savings
The argument for waiting:
- Better rates at lower LTVs save tens of thousands long term
- You'll have more cushion for emergencies
- Less stress around interest rate movements
For most people the right answer is "buy when 10% is achievable within 12 months", because that 10% threshold is where rates become sensible without leaving you completely cash-poor.
A quick worked example
You're 28, earning £40,000, and want to buy a £230,000 flat in Manchester. A 4.5x salary multiple gives you a borrowing capacity of £180,000.
- 5% deposit (£11,500): loan of £218,500 — exceeds your borrowing capacity. Not viable unless you find a lender doing 5x salary.
- 10% deposit (£23,000): loan of £207,000 — still exceeds £180,000. Not viable at 4.5x.
- 22% deposit (£50,000): loan of £180,000 — just within your cap. Viable.
In other words: in some markets your deposit is determined not by what banks will accept but by what your salary will support after deposit is deducted from price.
Get a free mortgage quote — find out exactly what you can borrow with your real numbers.
Frequently asked questions
Can I buy a house with no deposit? Almost never as a residential buyer. There are a couple of niche 100% LTV products (Skipton's Track Record mortgage, for example) but they require a track record of paying rent reliably and tend to come with higher rates.
Do I need to put the deposit down at the offer stage? No. You'll typically pay £500–£1,000 as a "reservation fee" with new-builds or nothing at all on existing homes. The deposit transfers on exchange of contracts, not at offer.
Is a gifted deposit treated the same as savings? Yes — providing your relative signs the gifted deposit letter and the funds clear into your account at least 28 days before completion.
Can I use my LISA and a gifted deposit together? Yes, both are accepted. Many FTBs combine them.
What if I have a deposit but no income? You won't get a mortgage on that basis alone — affordability is independent of deposit. A guarantor or joint applicant might bridge the gap.
This article is for informational purposes only and does not constitute financial advice. Always consult a qualified mortgage adviser before making a decision.