Complete First-Time Buyer Guide 2025

Getting Started

Buying your first home is one of life's biggest financial decisions. With UK house prices averaging £288,000 and first-time buyer deposits typically requiring £45,000+, thorough planning and understanding of the process is essential for success.

This comprehensive guide covers everything from initial budgeting through to getting your keys, helping you navigate the complex UK property market with confidence and avoid common pitfalls that can delay or derail your purchase.

Quick Start Checklist

Before house hunting: Check your credit score, calculate affordability, save for deposit and costs, research locations, arrange mortgage pre-approval, and instruct a solicitor. This preparation typically takes 3-6 months but significantly improves your chances of success.

Financial Planning & Budgeting

Affordability Assessment

Lenders typically offer 4-4.5 times your annual income, but actual affordability depends on your expenses, credit history, and chosen product. Use our affordability calculator to get realistic estimates before house hunting.

Income Multiple: Most lenders offer 4.5x annual salary (some up to 5.5x)
Stress Testing: Affordability tested at rates 3% above actual rate
Existing Commitments: Credit cards, loans, and other financial obligations reduce borrowing capacity
Deposit Impact: Higher deposits unlock better rates and more lender choice

Deposit Requirements

Most first-time buyers need at least 5% deposit, though 10-15% opens up significantly better mortgage deals and lower monthly payments.

Deposit %	On £250k Property	Typical Rate	Monthly Payment*	Lender Options
5%	£12,500	5.8%	£1,419	Limited
10%	£25,000	5.2%	£1,334	Good choice
15%	£37,500	4.8%	£1,275	Excellent choice
20%	£50,000	4.5%	£1,235	Best rates

*25-year term, approximate figures for illustration only

Additional Costs to Budget

Stamp Duty: 0% on first £425,000 for first-time buyers (2025 rates)
Legal Fees: £800-£1,500 for conveyancing
Survey Costs: £300-£1,000 depending on property and survey type
Mortgage Fees: £0-£2,000 arrangement fees plus valuation costs
Moving Costs: £500-£2,000 for removal services and immediate expenses
Insurance: Buildings insurance from completion, contents insurance recommended

Government Support Schemes

Several government schemes help first-time buyers reduce deposit requirements, access better rates, or purchase homes they couldn't otherwise afford.

Help to Buy Equity Loan

Government provides up to 20% equity loan (40% in London) with just 5% deposit required.

Available on new-build properties only
No interest for first 5 years
Regional price caps apply
Must be repaid on sale or remortgage

Shared Ownership

Buy 10-75% share of property, pay rent on remaining portion to housing association.

Lower deposit requirements (5-10%)
Opportunity to "staircase" to full ownership
Income and location restrictions apply
Leasehold properties with service charges

ISA Schemes

Lifetime ISA offers 25% government bonus on savings up to £4,000 annually.

Must be aged 18-39 to open
Property must cost under £450,000
Funds locked until age 60 or first home purchase
Penalty for other withdrawals

Scheme Considerations

Government schemes have specific eligibility criteria and restrictions. Research thoroughly and consider long-term implications before committing. Some schemes may limit your choice of property or future flexibility.

The Buying Process

The property buying process typically takes 8-12 weeks from offer acceptance to completion, though preparation should begin months earlier.

Step 1

Preparation Phase

Check credit score, save deposit, get mortgage pre-approval, and research areas. This foundation work is crucial for a smooth purchase.

Step 2

Property Search

View properties, attend open houses, and shortlist options. Focus on location, condition, and growth potential within your budget.

Step 3

Make an Offer

Submit competitive offer based on comparable sales, property condition, and market conditions. Negotiate terms including completion timeframe.

Step 4

Mortgage Application

Submit full mortgage application with required documentation. Lender arranges valuation and underwrites your application.

Step 5

Legal Process

Solicitor conducts searches, reviews contracts, and handles legal requirements. Survey arranged to check property condition.

Step 6

Exchange & Completion

Exchange contracts to legally commit, then complete on agreed date when keys are handed over and ownership transfers.

Mortgage Basics

Types of Mortgage Products

Fixed Rate: Interest rate fixed for 2-10 years providing payment certainty
Variable Rate: Rate can change, including tracker and discount mortgages
Offset Mortgage: Savings offset against mortgage balance reducing interest
Help to Buy Mortgage: Specific products for government scheme participants

Choosing the Right Product

Consider your circumstances, risk tolerance, and future plans when selecting a mortgage:

First-time buyer rates: Many lenders offer preferential rates for first purchases
Term length: Longer terms reduce monthly payments but increase total interest
Early repayment: Check overpayment allowances and exit fees
Portability: Ability to transfer mortgage to new property

Application Requirements

Proof of Identity: Passport or driving license plus utility bill
Income Evidence: 3 months' payslips, employment contract, P60
Bank Statements: 3-6 months showing salary credits and spending patterns
Credit History: Lender credit check plus explanation of any adverse credit
Deposit Source: Evidence showing origin of deposit funds

Common Mistakes to Avoid

Inadequate Research: Not understanding local market conditions or property values
Overextending Financially: Borrowing maximum amount without considering future expenses
Skipping Survey: Failing to identify structural issues before purchase
Poor Timing: Rushing process or not allowing adequate time for completion
Ignoring Additional Costs: Underestimating total purchase expenses beyond deposit
Chain Complications: Not understanding implications of property chains
Limited Mortgage Shopping: Accepting first offer rather than comparing products
Emotional Decisions: Falling in love with property beyond sensible budget

Success Tips

Start preparing early, get professional advice, maintain realistic expectations, and stay flexible during the process. The most successful first-time buyers are well-prepared and make informed decisions rather than rushed emotional choices.

Timeline & Next Steps

Typical Timeline

6-12 months before: Start saving, improve credit score, research areas
3-6 months before: Get mortgage pre-approval, instruct solicitor
1-3 months before: Active house hunting and viewings
Offer to completion: 8-12 weeks for legal process and mortgage

Your Action Plan

Immediate: Check credit report and calculate realistic budget using our tools
This month: Research mortgage options and speak to broker or lender
Next 3 months: Save deposit, arrange pre-approval, start property search
Ongoing: View properties, make offers, progress through legal process

Ready to Start?

Use our mortgage calculators to understand your borrowing capacity, then speak to a qualified mortgage advisor about your options. Good preparation significantly improves your chances of securing your ideal first home at the best possible rate.