How much deposit do I need to buy a house?

Most mortgage lenders in the UK ask for a deposit of at least 5% of the property's price, and borrow the remaining 95%¹. On a £200,000 home that means a deposit of £10,000; on a £300,000 home, £15,000³. In practice, first-time buyers typically put down far more: the average first-time buyer deposit is around £55,000, according to the English Housing Survey cited in a Treasury Committee report⁴. A 5% deposit on an average-priced UK home was estimated at around £12,500 in March 2022⁵.

The deposit is the single biggest hurdle for most buyers, but it is not a fixed number. The 5% minimum is a floor, not a target, and the size of your deposit shapes almost everything else about the mortgage: how much you can borrow, which deals are open to you, and how much the loan costs. This page explains how the numbers work, what lenders look for when the deposit is small, which schemes let you buy with less, and what it all means for the risks you take on.

The minimum deposit: usually 5% of the price

The starting point is simple: to get a mainstream mortgage you will normally need a deposit of at least 5% of the property's value². Official guidance across the UK says the same thing. In Northern Ireland, nidirect's step-by-step guide to buying a home states that "you'll usually need to pay a deposit of at least five per cent of the house price to the seller"¹. Which? puts it the same way for the UK generally: you will usually need to save a deposit of at least 5% of the price of the property you want to buy³. Scope, the disability charity, notes that the deposit is normally at least 5% of the property's total value⁹, and National Debtline says you will usually need to be able to pay at least a 5% deposit towards the purchase of a property¹⁰.

That 5% figure is a minimum, not the norm. The average first-time buyer deposit of around £55,000⁴ is far above 5% of typical prices, because most buyers save more to unlock cheaper deals. A 5% deposit on an average-priced UK home was put at around £12,500 in March 2022⁵, which gives a sense of the gap between the floor and what people actually save.

A few situations change the minimum. Buy-to-let mortgages work differently: you will usually need at least a 20% deposit, meaning a maximum loan to value of 80%⁶. Some schemes lower the deposit needed, because you buy only a share of the property or the government contributes alongside you: shared ownership in England requires a deposit of at least 5% of the share you are buying, not of the whole property¹¹, and the Your First Home scheme announced in September 2026 is expected to support deposits of 2.5% on new-builds in England⁷. These are covered in more detail under deposits below 5% below.

How loan to value works and how to work it out

The loan to value ratio, or LTV, is the size of your mortgage in relation to the value of the property you are buying or remortgaging⁶. It is the number lenders use to price every mortgage, and it is simply the mirror image of your deposit: a 5% deposit means a 95% LTV mortgage, and a 10% deposit means a 90% LTV mortgage¹².

To work it out yourself, divide your mortgage amount by the value of the property, then multiply by 100⁶. On a £200,000 property with a £10,000 deposit, the mortgage is £190,000, and £190,000 divided by £200,000 gives 95%⁶. If you have a 10% deposit, your LTV will be 90%, as your mortgage will need to cover 90% of the property price¹².

Most mortgage lenders price their mortgages in LTV brackets, or bands, which are usually set at 5% intervals between 60% and 95%⁶. This is why deposit size matters so much: crossing a band boundary, say from a 95% LTV to a 90% LTV, can move you into a cheaper pricing bracket. Independent guidance rates the bands as follows: below 80% LTV is considered good, meaning a deposit of at least 20%; below 75% is very good, meaning at least a 25% deposit; and 60% or lower is excellent, meaning at least a 40% deposit⁶.

One scheme imposes its own LTV limit: if you are remortgaging a home bought with a Help to Buy equity loan, your loan to value normally cannot be more than 75% of the value of your home, unless you are repaying part of your equity loan at the same time¹³.

Deposit bands: 5%, 10%, 15% and 20% compared

Because lenders price in 5% LTV steps⁶, the deposit bands that matter are 5%, 10%, 15% and 20%. The cash amounts scale directly with the price of the property. On a £200,000 property, a 5% deposit would be £10,000, a 10% deposit would amount to £20,000, and a 15% deposit would be £30,000¹⁴. On a £300,000 property, the same bands work out at £15,000, £30,000 and £45,000¹⁵.

What each band buys you differs. At 5% you are at the very top of the market's LTV range, with the fewest deals and the highest rates. At 10% you drop into the 90% LTV band, where the choice widens. At 15% you reach 85% LTV, and at 20% you reach the 80% LTV threshold that independent guidance describes as "good"⁶. The cash amounts scale with the price: on a £300,000 example purchase, a 5% deposit is £15,000, rising to £30,000 at 10% and £45,000 at 15%¹⁶.

The bands also matter for schemes. Shared ownership deposits are worked out on the share you buy, so a 5% to 10% deposit on a 25% share is a much smaller cash sum than the same percentage of the full price. The HOLD scheme for people with a long-term disability asks for a deposit usually between 5% and 10% of the share you are buying¹⁷, and the Older Persons Shared Ownership scheme works the same way¹⁸.

Why a bigger deposit gets you better terms

A bigger deposit does three things at once. It lowers your LTV, which moves you into a cheaper pricing band⁶. It reduces the amount you borrow, so the same rate costs less each month. And it signals lower risk to the lender, which can unlock more generous lending rules.

That third effect is less obvious but real. If you have a deposit of 25% or more, some lenders may be willing to offer you a higher income multiple, so you can borrow more against the same salary¹². Lenders usually offer their best mortgage rates to people with a deposit of at least 40%, which is a 60% LTV⁶.

The relationship also runs in reverse, and this is where buyers with damaged credit histories feel it. After a repossession, a larger deposit and a higher interest rate are the likely requirements¹⁹, and Shelter Cymru notes that in many cases a larger than normal deposit has to be provided²⁰. The pattern repeats across the credit problems a lender can see:

• County court judgments (CCJs): the likely terms are a larger mortgage deposit, higher interest rates and a need to show a reliable income²¹.
• Individual voluntary arrangements (IVAs): if the IVA was settled within the last three to four years, a lender may look for a deposit of anything between 15% and 25%²².
• Bad credit generally: specialist lenders tend to be more flexible when assessing applications, but they often charge much higher rates and require larger deposits²³.

The same applies outside the mainstream UK market: the deposit needed to buy an overseas property tends to be higher than you would need for a standard UK mortgage²⁴. The common thread is that the deposit is the lender's cushion. The smaller it is, the more exposed the lender is if prices fall, and the more they charge or restrict to compensate.

95% mortgages: what lenders look for

A 95% mortgage is a loan for 95% of a property's price, where you put down a 5% deposit to cover the rest²⁵. It is the standard route for buyers with the minimum deposit, and it is theoretically available to both first-time buyers and home movers²⁵.

Lenders do not just look at the deposit. They assess the full range of your income, regular outgoings and any debt, and they stress test your finances, meaning they check whether you could still afford the mortgage payments if interest rates were to rise²⁵. On income, you can usually borrow up to four-and-a-half times your salary, or combined salary if you are buying with someone else²⁵. As a worked example, if you had saved a 5% deposit of £10,000 for a £200,000 home, you would usually need a salary of at least £42,000, or a combined salary of the same amount for a couple²⁵.

The 95% market has been supported by government backstops. The Mortgage Guarantee Scheme, extended in 2025, enables eligible first-time buyers and home movers to buy a home with a 5% deposit as a share of the purchase price²⁶. Its predecessor worked the same way: the Help to Buy mortgage guarantee offered a government guarantee to lenders who offered mortgages to people with a deposit of between 5% and 20%²⁷. The detail of these schemes is covered in the Mortgage Guarantee Scheme.

Rates on high-LTV deals have not always been punitive. In March 2022, independent analysis found that rates below 3% were available even with a small deposit⁵, though rates across the whole market move and that figure is a snapshot of its time. The structural point stands: 95% deals exist, are more plentiful when a guarantee scheme is in place, and cost more than the same lender's lower-LTV deals.

Deposits below 5%: £5,000 deposits and schemes that lower the deposit

Below 5%, mainstream mortgages largely stop. You will usually need at least a 5% deposit to get a mortgage, meaning a 95% LTV loan, although it is possible to borrow more than 95% of the property value in some cases⁶. A handful of products have appeared at 98% LTV, but they are rare and tightly restricted, and their terms vary between lenders, so the specific lender's conditions set out what applies.

The more reliable route to a smaller deposit is a scheme, because the scheme supplies part of the purchase price alongside you. The newest is Your First Home, announced by the government on 26 September 2026 and due to be confirmed at the Budget. It is expected to support 2.5% deposits for prospective first-time buyers purchasing a new-build property from a developer signed up to the scheme⁷, with a 20% government-backed equity loan and a 77.5% mortgage making up the rest.

Other schemes lower the deposit in different ways:

• Shared ownership (England): you buy a share of the property and pay rent on the rest, with a deposit of at least 5% of the share you are buying¹¹. See shared ownership in England.
• First Homes (England): homes sold at a discount to first-time buyers with a household income of £80,000 or less, or £90,000 or less in London¹¹. The policy requires that a minimum of 25% of all affordable homes secured through developer contributions should be First Homes²⁹. See the First Homes scheme.
• First Home Fund (Scotland): a £200 million pilot shared equity scheme to help first-time buyers buy their first home³⁰, in which a buyer must contribute a deposit of at least 5% of the purchase price³⁰. The government provides a contribution of up to £25,000 towards the purchase under a shared equity agreement³¹. The mean buyer's deposit contribution was £14,400, which is half the average first-time buyer deposit across Scotland³².
• First Homes Fund (Scotland): first-time buyers can get up to £10,000 towards a home worth up to £300,000³³, a contribution for first-time buyers that struggle to save enough for a full deposit³⁴. You may also need a deposit, usually around 5% of the purchase price, and you must have a mortgage that covers at least 25% of the purchase price³⁵.
• Open Market Shared Equity (Scotland): for any personal contribution above £5,000, 90% of your funds must be treated as a deposit contribution towards the cost of your home³⁶.
• Help to Buy - Wales: requires only a 5% deposit from you³⁷, defined as a minimum deposit of 5% of the purchase price³⁸. See Help to Buy - Wales.

The full range of options, including who qualifies in each nation, is set out in first-time buyer schemes.

Costs on top of your deposit: around £2,000 to £5,000

The deposit is not the only cash you need. Buying a home carries a set of additional costs, and buyers who budget only for the deposit are caught out by them. The typical range to plan for is around £2,000 to £5,000 on top of the deposit, covering the survey, conveyancing, and any moving costs¹⁵. The detailed breakdown is in the costs of buying a house.

Some of these costs are tied to the purchase process itself. When you make an offer, you may pay a holding deposit to the seller or agent, usually between £500 and £1,000³⁹. The standard amount of time a deposit can be held for is 15 calendar days after receiving it, unless a longer or shorter period is agreed in writing⁴⁰. This is distinct from your mortgage deposit: it is a commitment payment during the purchase, and the rules on it come from tenancy and letting fee guidance where a rental element is involved⁴⁰.

Stamp duty is the other big variable, and it differs by nation. In England and Northern Ireland you pay Stamp Duty Land Tax, with first-time buyer relief available on qualifying purchases. Scotland uses Land and Buildings Transaction Tax and Wales uses Land Transaction Tax. None of these is part of your deposit, but all of them need to be in your bank account at the right time, and a deposit saved to the exact penny will not cover them.

The risks of a small deposit

A small deposit gets you into the market, but it changes your exposure. The first risk is cost: 95% mortgages carry higher interest rates than lower-LTV deals²⁵, and the same loan at a higher rate costs more every month for the whole term.

The second risk is remortgaging. Taking out a 95% mortgage could make it difficult to remortgage to a better rate when your deal ends, as it can take a while to build up enough equity to move down an LTV band²⁵. If house prices fall rather than rise, you can stay stuck at a high LTV for years.

The third risk is the most serious: negative equity. With a 5% deposit, your equity to begin with is 5%⁴¹, so a fall in the property's value of more than that leaves you owing more to the lender than the home is worth. Negative equity matters most if you need to sell, because the sale price would not clear the mortgage. The options in that situation are covered in negative equity.

There are ways to reduce the risk without waiting to save more. Buying a smaller or cheaper property lowers the loan as well as the deposit. Buying with someone else combines two deposits and two incomes, which is covered in buying a home with someone else. Family help, whether a gifted deposit or the arrangements described in can my parents help me buy a home?, is one of the most common ways buyers reach a lower LTV band. And the shared equity and shared ownership schemes above reduce the deposit by sharing the purchase rather than by stretching the loan.

If you are struggling to save, free help exists. MoneyHelper, the government-backed money guidance service, offers free information on savings products, and a Lifetime ISA adds a government bonus to savings for a first home. The comparison of Lifetime ISA or Help to Buy: ISA explains how the two work. Debt charities such as National Debtline can advise if debt is holding back your saving, since lenders will assess any debt in your affordability check¹⁰.