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How much deposit do you need to buy a house?

how much deposit do you need to buy a house

This is a question we're asked all the time - and it's not surprising, as saving for a deposit can be one of the biggest blockers stopping people from buying a house. So, when it comes to your house deposit, how much do you need?

Before we answer that, we should probably start with:

What is a house deposit?

A house deposit is a sum of money that you pay up front when you buy a house. By paying a deposit, you own a part of the house outright and you can then secure a mortgage to help you to pay for the rest.

How much deposit do you need to buy a house?

This will depend on a few factors. You'll normally need to pay a deposit of at least 5% of the price of the property you're buying. This means that the higher the price of the property, the more you'll need to save for your deposit.

Other factors in determining the deposit you'll need to pay, are the company you apply to for a mortgage and the type of mortgage you apply for.

Check out this handy deposit calculator, created by Which...

What's the average house deposit in the UK?

According to research from Halifax, "UK first-time buyers are putting down an average deposit of £32,841, with those in London stumping up an eye-watering £110,656".

Is it worth saving a bigger deposit?

Yes! There are several benefits to paying as much of a deposit as you can...

Cheaper monthly mortgage repayments

It stands to reason - the more you pay up front, the less you pay for your mortgage. When you factor in interest rates, you can end up saving a considerable amount by saving a considerable deposit... 

Better mortgage rates

Speaking of interest rates... By paying a large house deposit, you're reducing the risk for your mortgage lender and so they may well offer you more favourable rates.

More likely to be accepted for a mortgage

Mortgage lenders decline applications when they view them as too risky. As we've seen, when you are able to pay a large deposit, that risk is reduced and so companies are more likely to accept.

Can you get a mortgage without a deposit?

0% Deposit mortgages are available, but will generally require a family member to act as guarantor. Be aware that these types of mortgages will generally come with higher interest rates. While it may feel tempting if you don't have a deposit saved yet, you'll probably end up paying much more with this option than if you take the time to save a deposit.

Can you get help with your house deposit?

There are various options available if you're struggling to save a deposit to buy a house. If you're a first time buyer you may want to consider the Government's Help to Buy; Equity Loan...

Help to Buy: Equity Loan

If you save 5% deposit, the government lends you up to 20% of the property’s value (or 40% in London). The loan is interest free for 5 years.

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BB Mortgages are here to help too!

Here at BB Mortgages, we have years of experience in finding people the right mortgage for their specific circumstances. We offer free consultations so why not book one now and we can chat about what the best options are for you.

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Ellen King

Absolutely delighted with the service we received from Dean. The advice we received was timely and thorough; the service provided went above and beyond our expectations compared to other mortgage advisors we have used in the past and the whole application process was made straightforward and stress free. Overall, an excellent value for money service that I would highly recommend.

Ellen King

BB Mortgages
2019-09-04T15:53:10+01:00

Ellen King

Absolutely delighted with the service we received from Dean. The advice we received was timely and thorough; the service provided went above and beyond our expectations compared to other mortgage advisors we have used in the past and the whole application process was made straightforward and stress free. Overall, an excellent value for money service that I would highly recommend.

Miss Knight

We would like to take this opportunity to thank you for your efforts in making it possible for us to purchase our first property.  You have been brilliant and your services have been friendly, helpful, swift and professional.  We cannot thank you enough and it has been an absolute pleasure working with you.  What is known to be a stressful time has been very smooth and I have yourselves to thank for this.

Miss Knight

BB Mortgages
2016-03-22T17:24:36+00:00

Miss Knight

We would like to take this opportunity to thank you for your efforts in making it possible for us to purchase our first property.  You have been brilliant and your services have been friendly, helpful, swift and professional.  We cannot thank you enough and it has been an absolute pleasure working with you.  What is known to be a stressful time has been very smooth and I have yourselves to thank for this.

Mr L

Mr L hadn’t sold his house but had found the house of his dreams, we arranged a mortgage that allowed him to buy his new house without selling and a mortgage that was flexible enough for him to pay a large amount off when he sells his house.

BB Mortgages
2016-09-13T12:38:09+01:00
Mr L hadn’t sold his house but had found the house of his dreams, we arranged a mortgage that allowed him to buy his new house without selling and a mortgage that was flexible enough for him to pay a large amount off when he sells his house.

Miss G

Miss G sold her house and had found a new house, it all looked straight forward but she had a historical bankruptcy which meant lots of lenders were declining her. We found her a mainstream high street lender that would offer a mortgage even with her previous bankruptcy.

BB Mortgages
2016-09-13T12:43:22+01:00
Miss G sold her house and had found a new house, it all looked straight forward but she had a historical bankruptcy which meant lots of lenders were declining her. We found her a mainstream high street lender that would offer a mortgage even with her previous bankruptcy.

Mr W

Mr W works abroad but wanted to buy a buy to let property, most lenders will require him to own and live in in a mortgaged property in the UK, however we found a lender that would lend at sensible interest rates for a new buy to let purchase.

BB Mortgages
2016-09-13T12:48:10+01:00
Mr W works abroad but wanted to buy a buy to let property, most lenders will require him to own and live in in a mortgaged property in the UK, however we found a lender that would lend at sensible interest rates for a new buy to let purchase.

Mr C

Mr C wanted to buy a student house in Lincoln via a limited company to take advantage of the income tax benefits of this. He spoke with other brokers and high street lenders all of which said it wasn’t possible. We found a building society who specialise in this with sensible fees and interest rates.

BB Mortgages
2016-09-13T12:49:06+01:00
Mr C wanted to buy a student house in Lincoln via a limited company to take advantage of the income tax benefits of this. He spoke with other brokers and high street lenders all of which said it wasn’t possible. We found a building society who specialise in this with sensible fees and interest rates.
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