Step 1: Work out your deposit and budget
Most mortgage lenders ask for a minimum deposit of 5–10% of the property price, though a bigger deposit unlocks better interest rates. Lenders will also assess affordability based on your income, outgoings and credit history — as a very rough starting point, many lenders will lend up to around 4–4.5 times a single or joint annual income, though this varies significantly by lender and circumstances, so it's worth getting an agreement in principle early to see what's realistic for you.
Remember to budget for costs beyond the deposit itself: a mortgage valuation and/or survey, solicitor's (conveyancing) fees, Stamp Duty if applicable, and moving costs.
Step 2: Stamp Duty Land Tax for first-time buyers
Stamp Duty Land Tax (SDLT) applies in England and Northern Ireland (Scotland and Wales have their own equivalent taxes with different rates). First-time buyers get more generous thresholds than other buyers:
| Property price | First-time buyer rate |
|---|---|
| Up to £300,000 | 0% |
| £300,001 to £500,000 | 5% on the portion above £300,000 |
| Above £500,000 | No first-time buyer relief — standard rates apply to the whole purchase |
For comparison, standard (non-first-time-buyer) SDLT rates are 0% up to £125,000, 2% up to £250,000, 5% up to £925,000, 10% up to £1.5 million, and 12% above that — again, only the portion of the price within each band is taxed at that band's rate. To count as a first-time buyer for SDLT purposes, you (and anyone buying with you) must never have owned a residential property anywhere in the world before.
Step 3: Government schemes worth knowing about
- Lifetime ISA (LISA): save up to £4,000 a year towards a first home worth up to £450,000 and get a 25% government bonus on top.
- Shared Ownership: buy a share (typically 10–75%) of a property and pay rent on the remainder, with the option to buy more later ("staircasing").
- Mortgage guarantee schemes: government-backed schemes have periodically supported 95% mortgages for first-time buyers — availability changes, so check what's currently on offer through participating lenders.
Step 4: The buying process, stage by stage
- Get an Agreement in Principle from a lender or mortgage broker, showing roughly how much you can borrow.
- House-hunt and make an offer. Once accepted, the property is taken off the market but the sale isn't legally binding yet.
- Instruct a solicitor or licensed conveyancer to handle the legal side, and arrange a survey to check the property's condition.
- Submit your full mortgage application once you have a specific property and survey results.
- Exchange contracts. This is the point the sale becomes legally binding on both sides — pulling out after this stage typically means losing your deposit.
- Complete. The money transfers, you get the keys, and (where applicable) your solicitor pays any Stamp Duty owed on your behalf within 14 days.
Key takeaways
- First-time buyers pay no Stamp Duty up to £300,000, and a reduced rate up to £500,000 — above that, standard rates apply to the full price.
- Budget for deposit, fees, survey and moving costs separately — not just the headline house price.
- A LISA's 25% bonus is one of the few genuinely "free money" ways to boost a first-home deposit.
- Nothing is legally binding until contracts exchange, however far along an offer feels.