What do I need to know as a first time buyer?
To buy your first home, you need to understand your affordability, save for a deposit and obtain a mortgage in principle. Budget for legal fees and surveys while making use of government schemes to navigate the process.
Buying your first home involves understanding finances, mortgages, legal steps and extra costs. This FAQ guide breaks everything down simply so you know what to expect before starting your property search.
How much can I afford as a first time buyer?
Lenders usually base affordability on your income, expenses, debts and credit history. Most offer around 4 - 4.5 times your annual salary. Your monthly spending also affects what you can borrow. Getting a mortgage in principle helps set a realistic budget before viewing homes or making offers.
Related: What house can you afford?
What deposit do I need?
First time buyers typically need a deposit of at least 5-10% of the property price. A larger deposit improves your chances of approval and can unlock better interest rates. Saving more also reduces monthly repayments, making long term homeownership more affordable and financially stable over time.
Related: How much deposit do I need as a first time buyer?
What is a mortgage in principle?
A Mortgage in Principle (also called an Agreement in Principle) is a lender’s estimate of how much you could borrow based on your finances. It helps set your budget, shows sellers you’re serious, and strengthens your offer. It’s not a guarantee but is useful early in the buying process.
Related: What is a mortgage in principle?
What is a mortgage?
A mortgage is a loan used to buy a home, usually repaid over 25-35 years. You’ll pay interest on the amount borrowed. Common types include fixed, variable and tracker mortgages. A mortgage in principle shows how much a lender may be willing to lend before you make an offer.
Related: What is a mortgage?
What is stamp duty?
Stamp Duty Land Tax (SDLT) is a government tax paid when buying property in England and Northern Ireland. First-time buyers pay nothing up to £425,000. Above that, reduced rates apply depending on price bands. It is a one-off cost due after purchase completion and should be included in your budget.
Related: What is stamp duty? & Are first time buyers exempt from stamp duty?
What other costs should I expect?
Beyond your deposit, expect extra costs such as solicitor fees, surveys, mortgage arrangement fees, valuation charges, and removals. Insurance and ongoing maintenance also add up. These costs can total several thousand pounds, so it’s important to budget carefully before committing to a property purchase.
Related: What additional costs should I consider?
What is the buying process?
The process includes getting a mortgage in principle, finding a property, making an offer and instructing a solicitor. After surveys and mortgage approval, contracts are exchanged. Completion follows, when funds are transferred and you receive the keys. The full process usually takes around 8-16 weeks.
Related: What are the stages of buying a home?
What is a property survey?
A property survey checks the condition of a home before purchase. It identifies issues like damp, structural damage or repairs needed. Options include condition reports, homebuyer reports, or full structural surveys. Choosing the right survey helps avoid unexpected costs after buying and ensures you understand the property’s condition.
What happens on exchange and completion?
Exchange of contracts makes the purchase legally binding for both buyer and seller. Completion is when ownership officially transfers and you receive the keys. Between these stages, final payments are made. Once exchanged, pulling out can result in losing your deposit, so it is a critical step.
Related: What happens after you exchange?
What help is available for first time buyers in England?
First-time buyers may benefit from schemes like Lifetime ISAs, Shared Ownership, or government-backed initiatives such as First Homes. These can reduce upfront costs or boost savings. Availability depends on eligibility and location, so it’s important to check current schemes before starting your property search.
Related: Help available to first time buyers.
How much can I borrow?
How much you can borrow depends mainly on your income, outgoings, deposit size, and credit history. Most lenders offer around 4-4.5 times your annual salary. Using a mortgage calculator or getting a mortgage in principle helps you understand your budget before searching for properties.
Related: How much can I borrow for my first home?
What is council tax?
Council Tax is a local tax paid to your local council to fund services like rubbish collection, schools and road maintenance. The amount you pay depends on your property’s valuation band and location. First-time buyers should budget for it as an ongoing monthly cost after moving in.
Related: What is council tax?
What questions do I need to ask when viewing a property?
When viewing a property, ask about its condition, history, and running costs. Key questions include why the owner is selling, how long it’s been on the market, and whether there are any issues like damp or repairs needed. Also check broadband speed, parking, and what’s included in the sale.
Related: Questions to ask when viewing a property.
What is a credit report?
A credit report provides a detailed breakdown of your borrowing history and how you manage your commitments. It tracks your activity across credit cards, personal loans and mortgages, while also noting whether you’re on the electoral roll and if you have any court judgments (CCJs) or insolvencies. Lenders use this data to calculate your credit score, which determines your eligibility for better interest rates.
Related: What is a credit report?.
What is a financial health check?
A financial health check is an assessment of your current money situation, designed to highlight areas for improvement and help you reach your goals. While many UK banks and building societies offer these reviews for free, keep in mind they are often used as a way to suggest their own specific savings or loan products. For a more impartial look at your budget and debts, you can use free, independent tools like the MoneyHelper (formerly Money Advice Service) interactive calculator.
Related: What is a financial health check?.
Disclaimer
newhomesforsale.co.uk is an information platform and not a financial advisor, mortgage broker or mortgage lender. Always get financial advice before making significant decisions about your money, mortgages and buying a house.
Publish date 28th April, 2026
Reading time: 6 minutes
Written by Heather Bowles
