First-Time Buyer Guide 2026: Everything You Need to Know

Buying your first home is one of the biggest financial decisions you will ever make. The process can feel overwhelming, but with the right preparation and knowledge, you can navigate it with confidence. This guide covers everything a first-time buyer in the UK needs to know in 2026, from saving a deposit to picking up the keys.

How much deposit do you need?

The minimum deposit for most mortgages is 5% of the purchase price. On a £250,000 property, that is £12,500. However, putting down a larger deposit of 10–15% will unlock significantly better interest rates and lower your monthly repayments.

Your deposit determines your loan-to-value (LTV) ratio. A 5% deposit means a 95% LTV mortgage, while a 15% deposit means an 85% LTV mortgage. Lenders view lower LTV borrowers as less risky, which is why they offer them better rates. Even saving an extra 1–2% can push you into a lower LTV bracket and save you thousands over the term of your mortgage.

First-time buyer stamp duty relief

First-time buyers in England and Northern Ireland benefit from stamp duty relief. You pay zero Stamp Duty Land Tax (SDLT) on the first £300,000 of the purchase price, as long as the total property price does not exceed £500,000. On a £400,000 property, a first-time buyer would pay just £5,000 in stamp duty, compared to £10,000 for a non-first-time buyer.

Use our stamp duty calculator to work out exactly how much you will owe based on your purchase price and buyer status.

Getting a mortgage

Before you start viewing properties, get an Agreement in Principle (AIP) from a mortgage lender. An AIP is a conditional offer stating how much the lender is willing to lend you based on your income, expenses, and credit history. It typically takes 24–48 hours and gives you a clear budget to work with.

Most lenders will offer between 4 and 4.5 times your annual salary, though this varies depending on your outgoings and credit score. The main types of mortgage to consider are:

• Fixed rate — your interest rate and monthly payments stay the same for a set period (usually 2 or 5 years), giving you certainty and protection against rate rises
• Tracker rate — your rate tracks the Bank of England base rate plus a set margin, meaning payments go up or down as the base rate changes
• Variable rate — the lender sets the rate and can change it at any time, offering less predictability but sometimes lower initial rates

Use our mortgage calculator to estimate your monthly repayments based on different deposit amounts, interest rates, and mortgage terms.

Government schemes for first-time buyers

Several government-backed schemes exist to help first-time buyers get on the property ladder. Here are the main options available in 2026:

• Lifetime ISA — save up to £4,000 per year and receive a 25% government bonus (up to £1,000 per year). You must be aged 18–39 to open one and use it for your first property purchase (up to £450,000)
• Shared Ownership — buy a share of a property (typically 25–75%) and pay rent on the remainder. You can staircase up to full ownership over time. This reduces the deposit you need significantly
• First Homes scheme — new-build homes sold to first-time buyers at a discount of at least 30% below market value. Available in selected areas and subject to local eligibility criteria
• Mortgage Guarantee Scheme — the government guarantees part of the mortgage, allowing lenders to offer 95% LTV mortgages with competitive rates. This means you only need a 5% deposit

The buying process step by step

Once you have your finances in order, here is what the buying process looks like from start to finish:

1. Save your deposit and get an AIP — this confirms your budget and shows sellers you are a serious buyer
2. Find a property — search online portals, register with local estate agents, and attend viewings. Do not rush this stage
3. Make an offer — research comparable sold prices and make an offer through the estate agent. Be prepared to negotiate
4. Instruct a solicitor or conveyancer — they will handle the legal work including searches, contracts, and transferring ownership
5. Arrange a survey — a homebuyer survey or building survey can reveal structural issues, damp, or other problems that could affect value
6. Mortgage valuation and formal offer — your lender will value the property and, if satisfied, issue a formal mortgage offer
7. Exchange contracts — both parties sign contracts and you pay your exchange deposit (typically 10% of the purchase price). The sale is now legally binding
8. Completion — the remaining funds are transferred, you pick up the keys, and the property is officially yours

Essential checks before you buy

Before committing to a purchase, make sure you have investigated the following. These checks can reveal issues that affect the property's value, running costs, or your quality of life:

• Flood risk — check whether the property is in a flood zone using our flood risk checker. Flooding affects insurance costs and resale value
• Crime rates — use our crime checker to see street-level crime data for the area
• EPC rating — check the energy efficiency rating with our EPC checker. A poor rating means higher bills and potential upgrade costs
• Sold prices — use our sold prices tool to see what neighbouring properties have sold for — this helps you assess whether the asking price is fair
• Planning applications — check the local council's planning portal for any proposed developments nearby that could affect your enjoyment or property value

Common first-time buyer mistakes

Even well-prepared buyers can fall into common traps. Here are the mistakes we see most often and how to avoid them:

• Not getting an AIP first — without knowing your budget, you risk falling in love with a property you cannot afford or missing out because sellers do not take you seriously
• Skipping the survey — a survey might cost £300–600, but it could save you tens of thousands by revealing hidden defects before you commit
• Not budgeting for extra costs — stamp duty, solicitor fees (£1,000–2,000), survey costs, moving expenses, and furnishing can add £5,000–15,000 or more on top of your deposit
• Rushing the decision — buying under pressure often leads to regret. Take your time, do your research, and do not let estate agents push you into a quick decision