You need £17,000 for a first home - here's how to do it

September 27, 2026 154news Acacia

You need £17,000 for a first home - here's how to save it - BBC News

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Saving for a First Home Deposit

By Kevin Peachey | Cost of living correspondent | Published 14 minutes ago

If buying your first home is the finishing line, then saving up the money to get there is a marathon. The "Your First Home" scheme, announced on Saturday, aims to help first-time buyers in England get on the housing ladder with a small deposit.

Currently, a 5% deposit on the current average UK house price of £272,000 plus moving costs and legal fees—will set you back about £16,850, according to financial information service Moneyfacts. That's daunting, but here are four ways that experts say you can at least make a start on saving for a deposit:

1. Make saving like a bill

Depositing an amount you can afford into a regular savers account the day after you are paid is a good way to start, suggests Anna Bowes, savings expert at financial advisers The Private Office. "It becomes like another bill, but one that you can benefit from in the future," she says. The type of account suitable depends on your circumstances. Some of the ones which pay the highest interest are only accessible if you hold a current account with the provider.

2. You could get £1,000 a year

You can save up to £4,000 a year in a Lifetime Individual Savings Account (LISA) and the government guarantees a 25% bonus. So, if you put the full amount in then the government will add £1,000 a year. But there is a catch; has left some people out of pocket. Money saved in a LISA can only be used to buy a first home up to the value of £450,000.

Ministers are planning to replace the LISA with a new First Time Buyer ISA, but there are no clear details yet about how it will work.

3. Start early

The earlier you start saving the more you can build up thanks to the magic of compound interest. In short, interest is added on a larger and larger pot as time goes by. Bowes says that saving £50 a month from the age of 20 would give you about £41,000 in 30 years' time when you hit 50, assuming interest of 5% is paid annually. Start 10 years later, and you'd need to save more than double - £101 a month - to have the same amount at the age of 50.

4. Save less

An increasing number of lenders are offering mortgage deals with little or no deposit required. David Hollingworth, from L&C, points to mortgages that have deposits starting from £5,000 and allow people to borrow up to 98% or 99% of the property purchase price.