Saving for a deposit is the first step in the homebuying journey. Many first time buyers find that using a savings account is a great way to build up their savings. We will guide you through the key things to think about, like how much you may need to save for a deposit and provide support throughout your journey to homeownership.
Here are some questions to think about:
- Do I know how to save for a deposit?
- Do I have existing savings?
- How much can I afford to save each month?
- How soon do I want to buy my home?
What is a mortgage?
A mortgage is a long-term loan that helps you own a property by borrowing money from a lender to cover the remaining cost after you've paid a deposit. The lender has the right to take your property if you don't repay the loan plus interest, so it's important to plan carefully and make sure you can meet the repayments.
There are various types of mortgages, understanding them will help you when you consider which mortgage is right for you. To learn more visit our page, understanding different types of mortgages.
What is a deposit?
A deposit refers to the initial amount of money that you pay upfront when buying a property. It can sometimes be referred to as a ‘down payment’, which is usually a percentage of the property’s value. The remaining cost will be financed through a mortgage.
How much deposit do I need to buy a house?
The amount of deposit that you will need to save to buy your first home will depend on the purchase price of the property that you wish to buy. The minimum deposit is 5%, but you should aim for a larger deposit if you can.
Having a higher deposit improves the likelihood of getting a mortgage and means your monthly mortgage repayments will be smaller. This is because the bigger the deposit, the smaller the balance that’s left to pay off.
Other considerations
Whilst knowing how to save for a house deposit is important, there are a number of other costs that come with moving into your first home that you should know about. Because of that, it’s a good idea to save more money than your deposit. This means that you’ll be prepared to cover the fees that may occur during the buying process.
Stamp Duty
Stamp duty is the tax you pay on the land you’re purchasing. So, rather than being a set price, stamp duty is calculated based on the cost of the house and only applies to homes above a certain value. Read our stamp duty guide for more detailed information.
Valuation fee
Before buying your new home, you’ll need to have it valued. This proves to the lender that the property is worth the amount they are going to lend you. The valuation fee you pay will be to cover this cost, however, you may find that the cost of this valuation is included on some mortgage products. Usually the valuation fee can be £250+ dependent upon the cost of your home.
Surveyors fee
Request a homebuyer or structural survey if you want to learn more about the property you’re buying. Where a property valuation tells you a property’s worth, a homebuyer or structural survey will provide detail on the condition of the house, such as if the roof requires repairs. If any large issues arise out of the survey, it will give you power to negotiate your offer price. You can get varying levels of surveys at different prices and they aren’t compulsory to the house buying process. If you want to find out more about your options, read our guide on the different types of homebuyer surveys. Surveyors fees can typically cost £250+ depending on the cost of your home.
Completion/arrangement fee
Your completion fee, sometimes referred to as an arrangement fee, is paid upon completion of your mortgage and is the fee to acquire the mortgage product you have selected. Not all mortgages have a completion fee, while others include the fee as part of the mortgage. We recommend speaking to a mortgage adviser to get a clear understanding of your full mortgage cost. The cost of a completion/ arrangement fee can be anywhere from £0-£2,500, depending on the application type.
Reservation/booking fee
Much like booking fees encountered elsewhere, a reservation fee (or booking fee) is a cost paid upfront with your application to secure your mortgage product while your application is processed. This is usually £100 - £200.
Legal fees
Legal fees for buying a house depend on the property’s price, location and complexity of the transaction. However, they usually range from £800 to £1,500 in the UK. Legal fees are normally paid to a solicitor or licensed conveyancer who handles the legal parts of your home purchase.
There will be other fees to think about such as removals costs of your furniture, you may want to redecorate or make improvements to your new home. Visit our average cost of moving home page to find out more.
Depending on your savings goal it can take anywhere from 1 to 5 years plus to save enough for a deposit. However, most people find it easier when they stick to good savings habits. Below are some of our tricks to help you save faster, to see more visit our Gen Z savings tips.
It’s best to begin by reviewing your current financial situation. Having an idea of your financial situation will let you start to piece together how much you will need to save to afford your first home.
A key part of saving for a house is making sure you keep on top of your savings. Try giving yourself a manageable saving goal each month, putting it away as soon as you’ve been paid to avoid the temptation to spend it.
- Shop around for the best utility deals.
- Change accommodation, downsize or live with parents.
- Pay for things upfront and avoid high purchase.
- Cancel unused subscriptions.
- Sell unwanted clothes or other items.
- Put money away as soon as you get paid.
What kind of savings account do I need?

Lifetime ISA
Lifetime ISAs (LISA) are a great way to save for your first home. As a first time buyer (aged between 18 and 39), this scheme enables you to save up to £4,000 tax-free each year. It is topped up by the Government’s 25% bonus, up to your 50th birthday.
You will only receive the government’s 25% bonus if you go on to use the savings in your LISA towards the deposit on your first home and/or towards your retirement.
If you make a withdrawal not connected to these two events then a 25% penalty will apply to the amount you withdraw. This will recover the government’s bonus and you will get back less than you have saved.

Regular Savings Account
If you want to get into a consistent savings habit, a regular savings account is a good option. Our Newcastle Regular Saver has a variable interest rate for 12 months and you can save up to £200 each calendar month. This account helps you build up your savings pot over a set period of time.
We offer a wide range of savings accounts if the above aren’t the right match for you. We offer easy access accounts, fixed rate accounts, limited access and notice accounts. View all our savings products to find out more.
House deposit calculator
To help you break down the cost of how much you will need to save to buy your home, try our deposit calculator. You can also explore 'additional fees', which will help give you an idea of how much you'll need to save.
This calculator is for illustrative purposes only and does not take into account your individual circumstances.
Calculate the time it will take to reach your savings goal
Use our duration calculator to work out how long it will take to reach your savings goal. Simply enter the amount you think you will need and how much you could save each month.
This calculator is for illustrative purposes only and does not take into account your individual circumstances.
Why choose to save for your first home with Newcastle Building Society?
We are the region’s largest building society with 32 branches on high streets stretching across the North East, Cumbria and North Yorkshire. We care about where we are from and are deeply committed to making a positive difference for the people and places that make up our heartland.
We’re owned by our customers (not shareholders), which allows us to focus on what’s really important – delivering great value through the products we offer, providing our customers with amazing service and building a sustainable, successful business that benefits our members, communities and region, both now and in the future.

Newcastle Building Society member feedback
"All persons who I have dealt with around my mortgage application have been outstanding. Explained everything in detail making sure I have understood, had a friendly but professional manner and just made the whole step by step process easy for me to deal with."
Our purpose is to "connect our communities to a better financial future" and it guides us in everything we do. We help members from all walks of life to own their own homes, save for the future and receive trusted financial advice. We’ve provided essential services to generations of members for more than 160 years.
I’ve already saved my deposit, now what?
If you've already saved up your deposit, visit our first time buyers page. We will guide you through the steps to take to get onto the property ladder.

Need some help?
Our lines are open Monday to Friday from 8am - 6pm. We're closed on bank holidays.
YOUR MORTGAGE WILL BE SECURED ON YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.