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You want to buy a home, and the first question you’ll probably ask yourself is, “can I afford it?” We think getting on the property ladder is a great idea, but only if you are in a suitable financial position. We cover typical deposit amounts needed, how much you can borrow given your income and other buying costs to factor in.
Being able to afford to buy a home often depends on how much you can borrow for a mortgage. The amount you can borrow depends on your annual income, debt levels and outgoings.
Different banks will lend you different amounts. Some banks can lend up to five times your annual salary, or even more in some cases.
However, the amount you can borrow will depend on your circumstances. For example, if you have significant debt which you are paying back you may be offered less.
When you are working out whether or not you can afford to buy a home, you will also have planned for saving the deposit — to pay for some of the purchase price of the house up-front.
In terms of how much deposit you will need to buy a house, you will usually need at least a 5% deposit deposit. This means if you’re buying a house for £250,000 you’ll need at least a £12,500 mortgage deposit. But, the bigger your deposit, the wider the choice of lenders and potentially lower (i.e. cheaper) mortgage rates you’ll typically be able to access. In fact, the average first time buyer put down a 20% deposit of £61,090 in 2024 according to Halifax.
Here are low deposit options:
Get fee-free mortgage advice from the award-winning expert advisers at Mortgage Advice Bureau.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Please note some branches of Mortgage Advice Bureau may charge a fee for mortgage advice if you go direct. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed. So make sure you use this site, this form or phone number for fee-free advice.
When you are considering whether you can afford to buy a home, there are a number of factors that influence how much your mortgage will cost, including:
When thinking if you can afford to buy a home, you don’t just have to pay for the house. There are many other buying costs you will have to budget for, that can add as much as 10% to the total bill:
Once you have an idea of the purchase price you are targeting, you can use our cost of buying calculator to get an estimate of the potential stamp duty, legal, survey and removals fees to budget for:
Your credit rating not only affects whether your mortgage application is successful – it can influence how much your monthly repayments will be, too. That’s why it’s essential to improve your credit score before you apply for a mortgage. See how to improve your credit rating before getting a mortgage.
HomeOwners Alliance Ltd is registered in England, company number 07861605. Information provided on HomeOwners Alliance is not intended as a recommendation or financial advice.
HomeOwners Alliance Ltd is an Introducer Appointed Representative of Mortgage Advice Bureau (Derby) Limited which is authorised and regulated by the Financial Conduct Authority.
HomeOwners Alliance Ltd is an Introducer Appointed Representative (IAR) of LifeSearch Limited, an Appointed Representative of LifeSearch Partners Ltd, authorised and regulated by the Financial Conduct Authority. (FRN: 656479).
Independent Financial Adviser service is provided by Unbiased, who match you to a fully regulated, independent financial adviser, with no charge to you for the referral.
Bridging Loan and specialist lending service provided by Chartwell Funding Limited, registered office 5 Badminton Court, Station Road, Yate, Bristol, BS37 5HZ, authorised and regulated by the Financial Conduct Authority (FRN: 458223). Your property may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it.
