Stepping onto the property ladder has become more challenging for today’s generation, with first-time buyer numbers jumping 19% in 2024 to 341,068 despite the average house price for new buyers reaching £311,034. While these figures show renewed optimism in the housing market, the reality remains that first-time buyers now need an average deposit of £61,090, representing 20% of the purchase price.
Start Saving Early
The foundation of successful property purchasing is in disciplined financial planning and realistic assessment of your savings capacity. Begin by evaluating your monthly income against all expenses, including existing debts, regular subscriptions and discretionary spending. This analysis shows exactly how much you can realistically commit to saving each month without compromising your quality of life or ability to handle unexpected expenses. Remember that the deposit is just one component of your required funds. Additional costs, including legal fees, property surveys, mortgage arrangement fees, and moving expenses, can easily add several thousand pounds to your budget. Property surveyors typically charge £400-£1,500 depending on the survey type, while solicitor fees range from £850 to £1,500. Factor in potential stamp duty costs, though first-time buyers currently pay zero stamp duty on properties worth up to £300,000, reduced from £425,000 in April 2024.
Explore Government Schemes for First-Time Buyers
The UK government offers several schemes specifically designed to support first-time buyers, each addressing different financial circumstances and regional needs. The Lifetime ISA allows individuals aged 18-39 to save up to £4,000 annually, with the government contributing a 25% bonus up to £1,000 per year. The First Homes scheme is particularly attractive for eligible buyers, offering 30-50% discounts on new build properties with prices capped at £250,000 after the discount (£420,000 in London). Priority is given to local key workers and those with local connections, making this scheme ideal for people wanting to remain in their communities. Importantly, these properties must be new-build homes, guaranteeing buyers receive contemporary construction standards, energy efficiency, and modern design features that lower long-term maintenance costs.
Look Into Low Deposit Mortgage Options
For buyers struggling to accumulate large deposits, several low-deposit mortgage options can accelerate the path to homeownership. The government’s Mortgage Guarantee Scheme, extended to June 2025, supports lenders in offering 95% mortgages by providing guarantees against potential losses. This means qualifying buyers can purchase with just a 5% deposit, though this comes with higher monthly payments and interest rates compared to larger deposit mortgages. Many major lenders, including Halifax, Nationwide, and Barclays, participate in this scheme, offering competitive rates to first-time buyers. However, properties must be valued under £600,000, and borrowers must meet standard mortgage affordability criteria. The scheme particularly benefits those buying new build properties, which often qualify for additional incentives from developers. You can also consider exploring specialist first-time buyer mortgage products that might offer lower rates or reduced fees. Some lenders provide family-assisted mortgages where relatives can contribute to deposits or act as guarantors, while others offer graduated payment mortgages that start with lower payments that increase over time as incomes typically rise.
Working with a qualified mortgage broker can reveal products not directly available to consumers while guaranteeing that you meet all eligibility criteria. They can also help structure your application to maximise approval chances and secure the most favourable terms for your circumstances. The mortgage market remains competitive, with rates continuing to improve throughout 2025, making this an opportune time for serious buyers to begin their property search.
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