How Much Deposit Do First Time Buyers Need in 2026

Madeleine Birtle
May 19
5 min read

Saving for your first home is one of the biggest financial challenges many people will face, and understanding how much deposit you actually need is often the first hurdle.

The good news is that in 2026, there are now more mortgage options, government schemes, and low-deposit products available than there have been for years. In some cases, buyers may even be able to purchase with little or no deposit at all.

If you’re planning to buy your first home this year, here’s everything you need to know about deposits, mortgage options, and the additional costs involved.

What Is the Minimum Deposit Needed in 2026?

The minimum deposit required depends on the type of mortgage product you qualify for. While many buyers still assume they need a huge lump sum saved, that is not always the case anymore.

100% Mortgages – No Deposit Required

A small number of lenders have reintroduced 100% mortgages, meaning some buyers can purchase a property without any deposit at all.

These products are primarily aimed at first time buyers who:

Have a strong and stable income
Have consistently paid rent on time
Have struggled to save while renting

Most lenders offering no-deposit mortgages will usually require:

At least 12 months of rent paid on time within the last 18 months
No recent missed payments
Applicants to be aged 21 or over

However, these products come with stricter affordability checks and often higher interest rates. There is also a greater risk of negative equity if property prices fall, so it’s important to seek professional mortgage advice before considering this route.

£5,000 Deposit Mortgages

Some lenders now offer mortgages with a fixed minimum deposit of £5,000, regardless of the property value.

These products can be particularly helpful in lower-priced areas where buyers may not need to save a full traditional percentage deposit.

For many buyers, this has created a more realistic pathway onto the property ladder.

5% Deposit Mortgages (95% LTV)

For the majority of first time buyers, a 5% deposit remains the standard starting point.

This is known as a 95% Loan-to-Value (LTV) mortgage.

Here’s what that looks like in real terms:

Property Price	5% Deposit
£200,000	£10,000
£250,000	£12,500
£300,000	£15,000

While a 5% deposit can help buyers get onto the ladder sooner, lower-deposit mortgages often come with:

Higher interest rates
Stricter lending criteria
Fewer lender options

Lenders will closely assess your:

Credit history
Income stability
Existing commitments
Spending habits

before approving a mortgage application.

What Deposit Do Most First Time Buyers Actually Put Down?

Although 5% may be the minimum, the average first time buyer deposit is often significantly higher.

According to recent UK Finance data, the average deposit for first time buyers in England is around £63,855, although this varies considerably depending on location.

Average Deposits by Region

Region	Average Deposit
England (overall)	£63,855
London	~£53,500
South East	~£38,000
North West	~£21,500
Wales	£35,572
Scotland	£30,551
Northern Ireland	£40,528

These figures include buyers who may have:

Saved for many years
Received family support
Purchased in higher-value areas

The most important figure is the deposit that works for your personal circumstances and affordability.

Why Saving a Bigger Deposit Helps

While it may be tempting to buy as soon as you reach the minimum deposit threshold, saving a little more can make a substantial difference financially.

Better Mortgage Rates

Mortgage lenders reserve their most competitive interest rates for buyers with larger deposits.

Moving from:

5% deposit → 10% deposit

can often significantly reduce:

Monthly repayments
Total interest paid over the mortgage term

More Mortgage Choice

In 2026, there are now over 980 mortgage products available at 90% LTV. Buyers with a 10% deposit generally have access to far more lender options than those with only 5%.

Lower Monthly Payments

The less you borrow, the lower your repayments are likely to be each month.

Stronger Mortgage Application

A larger deposit demonstrates financial stability and can strengthen your position during affordability assessments.

Government Schemes Helping First Time Buyers in 2026

Several schemes remain available to support first time buyers.

Mortgage Guarantee Scheme

The government continues to back 95% mortgages, encouraging lenders to offer low-deposit products even during uncertain market conditions.

Lifetime ISA (LISA)

A Lifetime ISA allows buyers aged 18–39 to:

Save up to £4,000 per year
Receive a 25% government bonus

This means you could receive up to £1,000 free from the government every year towards your first home deposit.

Shared Ownership

Shared Ownership allows buyers to purchase a percentage share of a property and pay rent on the remaining portion.

This reduces the upfront deposit requirement and allows buyers to gradually increase ownership over time.

First Homes Scheme

Eligible buyers and key workers may be able to purchase selected new-build homes at discounts of 30–50% below market value.

Stamp Duty Changes in 2026

Stamp duty thresholds changed in April 2025 for buyers in England and Northern Ireland.

First time buyers now pay:

No stamp duty on properties up to £300,000

After that:

£300,001–£625,000 → 5% on the portion above £300,000
Over £625,000 → Standard stamp duty rates apply

This is an important cost to factor into your overall budget, particularly in higher-priced areas.

Can Family Help With a Deposit?

Yes — gifted deposits are extremely common for first time buyers.

Most lenders accept gifted deposits provided:

The money is genuinely a gift and not a loan
A gifted deposit letter is signed
The donor can evidence the source of funds

Gifted deposits commonly range from:

£5,000–£30,000+

although some families contribute more.

Don’t Forget the Additional Buying Costs

Your deposit is not the only upfront cost when buying a property.

You should also budget for:

Solicitor/conveyancing fees: £1,000–£1,500
Survey fees: £300–£1,000
Mortgage arrangement fees
Moving costs
Buildings insurance

As a general guide, many buyers should allow an additional £3,000–£5,000 on top of their deposit for associated purchasing costs.

Final Thoughts

There is no single “right” deposit amount for first time buyers in 2026. Your ideal deposit depends on:

Your income
Where you are buying
Your affordability
The mortgage products available to you

As a general guide:

No deposit mortgages exist, but are rare
£5,000 deposit products are available with some lenders
5% remains the standard entry point
10%+ opens up better rates and more lender choice
15%+ usually secures the most competitive deals

Whatever stage you are at in your savings journey, speaking to a qualified mortgage adviser can help you understand:

What you could borrow
Which schemes you qualify for
The best products available to you
And how to structure your deposit strategy effectively

Get in touch with me HERE for more information

Your home may be repossessed if you do not keep up repayments on your mortgage.

This article is intended for general informational purposes only and does not constitute financial or mortgage advice. Mortgage products, lending criteria and deposit requirements vary depending on individual circumstances and market conditions. Always seek advice from a qualified mortgage adviser before making financial decisions.