Your deposit size significantly affects what you can borrow, your interest rate, and your monthly payments. Here’s everything you need to know about house deposits in 2026.
For the wider cluster covering deposit-building, 5% mortgages, affordability and first-home buying costs, use the main First-Time Buyers hub.
Minimum Deposit Requirements
Residential Mortgages
| Deposit Size | LTV | Availability | Typical Rate |
|---|---|---|---|
| 5% | 95% | Limited lenders | Highest rates |
| 10% | 90% | Most lenders | High rates |
| 15% | 85% | All lenders | Better rates |
| 20% | 80% | All lenders | Good rates |
| 25% | 75% | All lenders | Best rates |
| 40%+ | 60% | All lenders | Lowest rates |
Buy-to-Let Mortgages
| Deposit Size | LTV | Availability |
|---|---|---|
| 25% | 75% | Minimum required |
| 40% | 60% | Better rates |
| 50%+ | 50% | Best rates |
Deposit Needed by House Price
| House price | 5% deposit | 10% deposit | 15% deposit | 25% deposit |
|---|---|---|---|---|
| £150,000 | £7,500 | £15,000 | £22,500 | £37,500 |
| £200,000 | £10,000 | £20,000 | £30,000 | £50,000 |
| £250,000 | £12,500 | £25,000 | £37,500 | £62,500 |
| £300,000 | £15,000 | £30,000 | £45,000 | £75,000 |
| £350,000 | £17,500 | £35,000 | £52,500 | £87,500 |
| £400,000 | £20,000 | £40,000 | £60,000 | £100,000 |
| £450,000 | £22,500 | £45,000 | £67,500 | £112,500 |
| £500,000 | £25,000 | £50,000 | £75,000 | £125,000 |
| £600,000 | £30,000 | £60,000 | £90,000 | £150,000 |
The deposit is only part of the cash you need upfront: budget as well for stamp duty (in England and Northern Ireland; Land Transaction Tax in Wales, LBTT in Scotland), legal fees, a survey and moving costs.
How Deposit Size Affects Your Rate
Example: £250,000 House Purchase
| Deposit | Deposit Amount | LTV | Typical Rate | Monthly Payment* |
|---|---|---|---|---|
| 5% | £12,500 | 95% | 5.5% | £1,458 |
| 10% | £25,000 | 90% | 4.8% | £1,289 |
| 15% | £37,500 | 85% | 4.4% | £1,169 |
| 20% | £50,000 | 80% | 4.2% | £1,078 |
| 25% | £62,500 | 75% | 3.9% | £979 |
*25-year repayment mortgage. The rates are examples to show the effect of each band, not current deals.
Total Cost Over Mortgage Term
| Deposit | Loan Amount | Rate | Total Repaid | Interest Paid |
|---|---|---|---|---|
| 5% | £237,500 | 5.5% | £437,500 | £200,000 |
| 10% | £225,000 | 4.8% | £386,800 | £161,800 |
| 15% | £212,500 | 4.4% | £350,700 | £138,200 |
| 20% | £200,000 | 4.2% | £323,400 | £123,400 |
| 25% | £187,500 | 3.9% | £293,800 | £106,300 |
Difference between 5% and 25% deposit: about £93,700 less interest over the term, at these example rates (if the rates stayed the same for 25 years).
Deposit by Property Type
Different Requirements
| Property Type | Minimum Deposit | Recommended |
|---|---|---|
| Standard house | 5% | 10-15% |
| New build house | 5-10% | 15%+ |
| New build flat | 10-15% | 20%+ |
| Ex-council | 5-10% | 15%+ |
| Non-standard construction | 15-25% | 25%+ |
| Listed building | 10-15% | 20%+ |
New Builds Require More
Lenders are cautious with new builds because:
- Initial value may drop (new build premium)
- Build quality uncertain
- Developer incentives can distort value
First-Time Buyer Options
Standard 5% Deposit Mortgages
Many mainstream lenders and building societies offer 95% mortgages, though the choice is smaller than at 90% or below. A broker can tell you which lenders currently offer them.
Help to Buy Alternatives
With Help to Buy closed, consider:
| Scheme | What It Offers |
|---|---|
| Lifetime ISA | 25% bonus on savings up to £4,000 a year |
| Shared Ownership | Buy a share of 10% to 75% and pay rent on the rest (new homes) |
| First Homes | At least 30% off the market value for eligible local first-time buyers (England) |
| Rent to Buy | Rent at reduced rate while saving |
Lifetime ISA (LISA)
You can use a Lifetime ISA, bonus included, towards your first home if it costs £450,000 or less, you buy at least 12 months after your first payment in, a conveyancer or solicitor acts for you and you buy with a mortgage; any other withdrawal before 60 costs a 25% charge. You can open one if you’re 18 or over and under 40, and pay in up to £4,000 a year until you’re 50. The full conditions are in how to save for a house deposit.
Example (2026/27 limits): save £4,000 a year for 5 years = £20,000, plus £5,000 bonus = £25,000 deposit (before any interest or growth).
Where Your Deposit Can Come From
Acceptable Sources
| Source | Accepted? | Evidence Needed |
|---|---|---|
| Personal savings | Yes | Bank statements |
| Gift from family | Yes | Gift letter + their bank statements |
| Inheritance | Yes | Probate documentation |
| Sale of another property | Yes | Completion statement |
| Lifetime ISA | Yes | LISA statements |
| Bonus at work | Yes | Payslip showing bonus |
| Savings from salary | Yes | Bank statement trail |
Unacceptable Sources
| Source | Generally Not Accepted |
|---|---|
| Borrowed money (loan) | No — it’s debt, not deposit |
| Credit card advances | No |
| Gambling winnings | Rarely without extensive documentation |
| Cryptocurrency (sometimes) | Varies by lender |
| Unknown cash sources | Must be traceable |
Gifted Deposits
Most lenders accept gifts from immediate family:
| Requirement | Details |
|---|---|
| Gift letter | Confirming it’s a gift, not a loan |
| No repayment | Must not need to be repaid |
| Donor ID | Proof of identity |
| Fund source | Origin of donor’s money |
| Common donors | Parents, grandparents |
Template requirements for gift letter:
- Donor’s full name and address
- Confirmation amount is a gift
- Statement no repayment expected
- Donor’s signature
- Usually witnessed
How to Save a Deposit Faster
Monthly Savings Target
| Property Price | 5% Deposit | Save Over |
|---|---|---|
| £150,000 | £7,500 | 3 years @ £208/month |
| £200,000 | £10,000 | 3 years @ £278/month |
| £250,000 | £12,500 | 3 years @ £347/month |
| £300,000 | £15,000 | 3 years @ £417/month |
| £400,000 | £20,000 | 4 years @ £417/month |
Best Savings Strategies
| Strategy | Effect |
|---|---|
| LISA | 25% government bonus |
| Regular saver accounts | Higher interest for fixed monthly saving |
| Cut unnecessary spending | Faster saving |
| Increase income | Side jobs, overtime |
| Live with parents | Save on rent |
| Government schemes | Additional support |
What to Save In
| Account Type | Best For |
|---|---|
| Lifetime ISA | 1+ years until purchase |
| Regular saver | Disciplined monthly saving |
| Easy access saver | Short-term, flexibility needed |
| Cash ISA | Tax-free growth |
| Fixed rate bond | Guaranteed sum, fixed date |
Don’t Forget Other Costs
Your deposit isn’t your only expense. Budget for:
| Cost | Typical Amount |
|---|---|
| Stamp duty (England and NI) | None on the first £125,000; first-time buyers pay none on the first £300,000 of a home costing up to £500,000 (who qualifies) |
| Solicitor fees | £1,000-£2,000 |
| Survey | £250-£1,500 |
| Mortgage fees | £0-£2,000 |
| Moving costs | £300-£2,000 |
| Furnishing | Variable |
| Initial repairs | Variable |
Rule of thumb: on top of the deposit, budget roughly £2,000 to £7,500 for the costs above, plus any stamp duty.
Deposit Size Decision
When 5% Makes Sense
✅ First-time buyer wanting to get on ladder ✅ Confident income will increase ✅ Plan to overpay or remortgage to lower LTV ✅ Market conditions favour buyers
When to Save More
✅ Can wait 1-2 years to save more ✅ Want lower monthly payments ✅ Prefer financial security ✅ Buying new build (often need 10-15% anyway)
Key Takeaways
| Point | Detail |
|---|---|
| Minimum | 5% for most, 10-15% for some properties |
| Ideal | 10-15% balances rate vs waiting time |
| Best rates | 25%+ deposit |
| Buy-to-let | 25% minimum |
| First-time buyers | Use a LISA for the 25% bonus |
| Don’t forget | Other buying costs need budget too |
You Might Also Find Useful
- Stamp duty calculator: SDLT, LBTT and LTT
- Best Home Insurance UK 2026: Buildings & Contents Compared
- Credit Score Guide UK — How to Check and Improve Your Score
Related Guide
Your home may be repossessed if you do not keep up repayments on your mortgage. PocketWise provides information and guidance, not financial advice. Seek independent mortgage advice before making decisions about borrowing.