What can you afford, and where should you buy?

Where to start as a first-time buyer in London

Knowing where to start can be the hardest part of buying your first home in London.

Prices are high, competition is real, and the process involves more steps (and more costs) than most people expect. If you’ve ever typed “how much can I borrow in London” into a search engine and ended up more confused than when you started, this article is for you.

Here, we’ll walk you through everything you need to know as a first-time buyer in London getting onto the property ladder, including how much you can borrow based on your income, how much deposit you’ll need, what all the buying costs add up to, and which areas of London are actually affordable on different budgets. We’ll also cover the government schemes and family-support options that could help you onto the ladder sooner than you think, and explain how the mortgage process works from start to finish.

Whether you’re buying alone, as a couple, or with a little help from family, our guide will give you a clear, honest picture of what’s possible, and what to do next. Read on or contact Bennison Brown for advice.

How much can you realistically afford in London?

Let’s start with the numbers. London property prices are significantly higher than the national average, which means affordability calculations matter more here than almost anywhere else in the UK. But “affordability” isn’t just about what you can borrow. It’s about what you can borrow, combined with what you’ve saved, compared to what things actually cost in the areas you’re considering.

To bring this to life, here are three realistic first-time buyer scenarios that we come across regularly as a London mortgage broker:

Single professional, £40,000 income, £25,000 deposit

As a single person applying at a standard 5x income multiple, a lender would consider lending up to £200,000. With a £25,000 deposit amount, the maximum purchase price would be around £225,000, which could be considered tight for London. If this buyer accessed a 6x multiple (available through certain lenders), borrowing rises to £240,000, putting a purchase price of around £265,000 within reach.

Couple with combined income of £70,000, £40,000 deposit

At 5x income, this couple buying jointly could borrow up to £350,000. Combined with their deposit, maximum purchase price sits around £390,000. This opens up a good range of flats across outer London, including areas like Croydon, Sutton, Bromley, Walthamstow, and possibly a small terrace in some of the more affordable boroughs. At 6x income, borrowing rises to £420,000, pushing the purchase price to £460,000 and widening the options considerably.

Single buyer with £60,000 income and a £50,000 gifted deposit

A gifted deposit from family changes the picture significantly. With £300,000 borrowing capacity (5x) and a £50,000 deposit, the total budget reaches £350,000. This is enough for a well-located flat in areas like Lewisham, Woolwich, or parts of East London. With a 6x multiple, borrowing rises to £360,000, bringing the total to £410,000 and unlocking more central areas.

Your income

Most mortgage lenders assess affordability primarily on income. The standard calculation is a multiple of your gross annual income, typically between 4x.5 and 6x, though this varies by lender and individual circumstances.

So, what counts as income? Most lenders will consider your base salary as the starting point. Beyond that, the picture gets more nuanced:

• Employed buyers: Base salary is taken in full. Overtime, bonuses, and commission are usually included at 50–100% if they’re regular and evidenced over 1–2 years.
• Self-employed buyers: Lenders typically use 2–3 years of accounts or tax returns and average your net profit (or salary plus dividends if you operate through a limited company). One strong year won’t usually outweigh a weaker previous year in the calculation.
• Contractors: Many lenders will work off your day rate rather than your declared income, which can significantly increase your borrowing capacity.
• Benefits and investment income: Some lenders include these, particularly maintenance payments, rental income, and some state benefits. Most lenders accept Child Benefit.

The key point is that different lenders treat income differently, which is one reason using a whole-of-market mortgage broker in London makes such a difference. We know which lenders are most generous for your specific income profile.

Accessing higher income multiples

In recent years, more lenders have introduced options allowing borrowers to access 5.5x or even 6x income multiples, rather than the standard 4.5–5x. This can meaningfully increase what you can borrow. For example, on a joint income of £70,000, the difference between 4.5x (£315,000) and 6x (£420,000) is £105,000 of additional borrowing capacity.

However, these higher multiples don’t come automatically. Lenders generally require:

• A minimum household income (often £60,000–£75,000+, though some lenders start lower)
• A good credit history with no recent missed payments or defaults
• Stable employment, typically in a recognised profession (though not always)
• A loan-to-value (LTV) of 85–90% or below

Some lenders offer specific “professional mortgage” products for doctors, solicitors, accountants, and engineers that offer higher multiples with more flexibility. If you’re in a qualifying profession, it’s worth asking your broker about these specifically.

Deposit

In London’s market, your deposit plays a huge role in both what you can buy and the interest rate you’ll be offered.

The minimum average deposit for a residential mortgage is usually 5% of the purchase price (a 95% loan-to-value mortgage). On a £300,000 property, that’s £15,000. But with London house prices considerably higher than the UK average, even a 5% deposit on a typical London flat can represent a substantial sum.

Here’s why deposit size matters beyond simply unlocking a mortgage:

• The bigger deposit you put down, the lower your LTV, and the better the interest rate you’ll generally be offered. Rates tend to improve at 90%, 85%, 80%, and 75% LTV thresholds.
• At 95% LTV, you’ll typically pay a premium rate, which increases your monthly payments.
• A larger deposit also reduces your total loan size, which directly reduces your monthly payments.

Many first-time buyers in London receive help towards their deposit from family members. Gifted deposits – where a family member gives you money towards your purchase with no expectation of repayment – are accepted by most lenders. You’ll need a signed gifted deposit letter, and the donor will usually need to confirm they have no legal interest in the property. At Bennison Brown, we’ve done this plenty of times and will be able to help you get the right paperwork in place.

House buying costs

One of the most common surprises for first-time buyers is budgeting only for the deposit and later discovering all the additional costs of buying a property, such as Stamp Duty, conveyancing or solicitors’ fees, estate agent fees, surveys, insurance, and moving expenses. In London, these additional home-buying costs can add several thousand pounds to your total outlay. Here’s a clear breakdown:

Stamp Duty Land Tax (SDLT): First-time buyers in England benefit from Stamp Duty relief. You pay no SDLT on the first £300,000 of a property’s purchase price, and 5% on the portion between £300,001 and £500,000. If your property costs over £500,000, standard rates apply in full, and you lose the first-time buyer relief entirely.

Solicitor/conveyancing fees: Typically £1,500–£3,000 (plus VAT and disbursements such as searches and Land Registry fees). In London, expect the upper end of this range. Shop around, but don’t choose solely on price; a slow or unresponsive solicitor can cost you a property in a competitive market.

Survey costs: A basic mortgage valuation is arranged by your lender, but it’s not a survey. It’s simply confirming the property is worth what you’re paying. A HomeBuyer Report (Level 2) typically costs £400–£800, while a full Building Survey (Level 3) costs £700–£1,500+. For older properties, maisonettes, or anything with potential structural issues, a full survey is money well spent.

Mortgage arrangement fees: Many mortgage products carry a product fee, typically £500–£1,999. These can often be added to the loan, though that increases the total interest you pay over time. Our mortgage advisors will always show you the true cost comparison so you can make the right decision.

Mortgage broker fees: At Bennison Brown, we’re transparent about our fees upfront. Independent brokers may charge a flat fee, a percentage of the loan, or nothing at all (receiving commission from lenders instead). Be clear on what applies before engaging any broker.

Moving costs: A local move within London typically costs £800–£2,500 depending on volume and access. Book early as availability on short notice can be limited.

In total, first-time buyers in London should budget for approximately £5,000–£10,000 in additional costs on top of their deposit, depending on personal circumstances, purchase price, survey level chosen, and whether Stamp Duty applies.

Are there government schemes and the homes scheme in London for first-time buyers?

If saving a full deposit in London is taking longer than you’d hoped, there are a number of government schemes that could help you get onto the property ladder sooner than expected. Here’s what’s currently available and what to know about each:

Shared Ownership

Shared Ownership gives you the chance to buy yourself a share of a property (usually between 10% and 75%). You then own your share and live in the property while paying rent on the remaining share to a housing association. You only need a mortgage and deposit on the share you’re buying, which significantly reduces the initial capital required.

For example, if you’re buying a 40% share of a £400,000 property, you only need a mortgage of £160,000, and a 10% deposit on that is just £16,000, compared to £40,000 for a 10% deposit on the full property.

You can generally “staircase” over time, resulting in buying more shares until you own 100% of the property. Shared Ownership properties are available across London through housing associations and the Homes England website.

Remember: Doing this means you pay both a mortgage and rent simultaneously, and service charges on leasehold flats can be substantial. The overall monthly cost may be higher than it initially appears. Make sure you model the full picture with your broker.

First Homes

First Homes is a government program that provides newly built homes to eligible first-time buyers at a minimum of 30% off market value, sometimes up to 40–50%. The discount is permanent as it passes on to the next buyer when you sell, which keeps homes affordable for future generations but also limits the equity gain you’d make on sale.

Eligibility requires a household income below £80,000 (or £90,000 in London), and some developers and councils apply additional local connection or key worker criteria. Availability varies significantly by location, and the scheme is concentrated around new developments.

Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme supports lenders offering 95% LTV mortgages by providing a government-backed guarantee on the portion above 80% LTV. This increases the number of 5% deposit mortgage products available on the market, particularly for properties up to £600,000.

As a buyer, you don’t apply for this scheme directly. Your lender participates in it, and you simply access one of the qualifying mortgage products. Not all lenders participate, and rates at 95% LTV tend to be higher than at lower LTV bands. It’s a useful safety net for buyers who have a strong income and stable employment but simply haven’t had time to build a larger deposit.

Lifetime ISA (LISA)

While not a property purchase scheme per se, the Lifetime ISA is one of the best tools available to London first-time buyers who are still saving. You can save up to £4,000 per year, and the government adds a 25% bonus, up to £1,000 per year, giving you free money towards your deposit.

The key restriction is that LISAs can only be used for a first residential property priced at up to £450,000. Given London property prices, this rules out many properties in the capital, but it remains very useful for buyers targeting outer London or leasehold flats within that threshold. You must be aged 18–39 to open one, and the penalty for withdrawal outside qualifying circumstances is significant.

House prices across London: where should you buy?

One of the most common questions we hear from first-time buyers is: “I know what I can afford but where in London can I actually buy?”

The overall average property price in London is around £671,647 (as of 2026), but individual prices can vary drastically from one street to the next due to desirability and connectivity. The table below gives you an indication of average house and flat prices across a wide range of London areas, from inner zones to outer commuter-belt locations. Use them as a starting point, not a guarantee.

Area	Avg House Price	Avg Flat Price	Tube Zone	Location
Bromley	£420,000	£275,000	Zone 3–5	Outer South-East
Croydon	£375,000	£240,000	Zone 3–5	Outer South
Barking & Dagenham	£350,000	£230,000	Zone 3–4	Outer East
Sutton	£400,000	£255,000	Zone 3–5	Outer South-West
Walthamstow (E17)	£550,000	£340,000	Zone 3	Outer North-East
Lewisham	£480,000	£310,000	Zone 2–3	Inner South-East
Tooting / Mitcham	£510,000	£320,000	Zone 3	Outer South
Woolwich / Thamesmead	£390,000	£255,000	Zone 3–4	Outer South-East
Stratford (E15)	£470,000	£335,000	Zone 2–3	Inner East
Finsbury Park (N4/N7)	£620,000	£390,000	Zone 2	Inner North
Brixton (SW9)	£580,000	£380,000	Zone 2	Inner South
Hackney (E8/E9)	£650,000	£430,000	Zone 2	Inner East
Clapham (SW4)	£700,000	£460,000	Zone 2	Inner South
Islington (N1)	£800,000	£510,000	Zone 1–2	Inner North
Canary Wharf (E14)	£680,000	£450,000	Zone 2	Inner East

Sources: Land Registry, Rightmove, and Zoopla data, 2024–2025. Averages reflect recent sold prices and active listings; individual properties will vary.

How to choose the right area for you

Naturally, budget will narrow your search, but there are several other factors worth weighing up carefully before you commit to a location. A first-time buyer mortgage in London is a long-term commitment, so you want to be confident you’ve chosen somewhere you’ll be happy to live.

Commute time and transport links

London’s transport network is excellent, but travel times still vary enormously. Outer boroughs like Bromley, Croydon, and Barking offer lower prices, partly because commutes are longer. Before writing off a location as “too far out,” check the actual door-to-door journey time, not just to the nearest tube station. Some areas in Zone 5 have faster trains to the City than those in Zone 2, which are served only by the Underground.

Safety and community feel

Boroughs that look inexpensive on paper can vary widely at the neighbourhood level. Crime statistics (available via the Met Police website and Numbeo) are worth reviewing, but so is spending time in an area. Try walking around at different times of day to give you a far better sense of whether it’s somewhere you’d like to put down roots.

Future resale potential

Some areas of London have seen dramatic price growth as regeneration and improved transport links change their character. Walthamstow, Stratford, and Woolwich are examples of areas that were once considered “beyond the pale” for many buyers and have transformed significantly. Look at planned infrastructure (the Elizabeth line’s impact is a masterclass in this), regeneration projects, and population trends when thinking about which areas have upside.

Local amenities

Think about what matters to you day-to-day: good restaurants and cafes, parks, independent shops, schools (even if you don’t have children, school catchments affect resale value), GP surgeries, and supermarkets. Some outer boroughs feel genuinely like towns with everything you need nearby; others require a commute for a decent cup of coffee.

Outdoor space

If outdoor space matters to you, factor it into your property search specifically. Many London flats come with no private garden, though communal gardens are common in converted Victorian properties. Areas like Bromley, Surbiton (just over the London border), and Chislehurst offer much more green space per pound spent than inner zones. Something that became a major priority for many buyers post-2020 Covid.

Long-term plans

Are you planning to stay for five years and sell, or is this somewhere you’d consider forever? Do you plan to start a family, which might mean needing more space in a few years? A one-bedroom flat might be the sensible first step, but think about whether your lifestyle is likely to change significantly within your expected ownership window.

Buying somewhere you’ll quickly outgrow can mean selling in a hot market with Stamp Duty costs, legal fees, and agents’ fees eating into any equity you’ve built.

How to get a mortgage as a London first-time buyer

The mortgage process can feel opaque if you’ve never done it before. Here’s exactly how it works when you come to us at Bennison Brown, and what to expect at each stage.

Step 1: Initial consultation

We start with a full conversation about your situation, including your income, employment type, savings, credit history, and what you’re hoping to buy. There’s no obligation at this stage. Our goal is to give you a clear, honest picture of what’s achievable, which lenders are most suitable for your profile, what loan repayments you might make and what you should do if anything needs addressing before you apply (such as improving your credit score or saving a little longer).

Step 2: Agreement in Principle (AIP)

Once we know what you’re looking for, we’ll secure an Agreement in Principle (also called a Decision in Principle or Mortgage in Principle) from a suitable lender. This is a conditional statement that the lender is prepared to lend you a certain amount, subject to a full application and valuation. An AIP makes you a serious buyer in the eyes of estate agents, and in London’s competitive market, some agents won’t accept offers without one.

Step 3: Finding a property and making an offer

With an AIP in hand, you’re ready to view properties and make offers. When your offer is accepted, let us know immediately, as this is when we move swiftly to protect your position.

Step 4: Full mortgage application

We’ll gather all required documents, including payslips, bank statements, proof of deposit, ID, and (if applicable) your solicitor’s details, and submit your full mortgage application.

At this stage, our expert advisors are assessing the whole of the market to find mortgage deals and ensure you’re on the most suitable product for your circumstances.

Step 5: Valuation and underwriting

Your lender will arrange a valuation of the property to confirm it’s suitable security for the loan. Their underwriters will then review your application in full. We manage this process and respond quickly to any queries, keeping things moving as smoothly as possible.

Step 6: Mortgage offer

Once the lender is satisfied, they issue a formal mortgage offer. Your solicitor will review this alongside the property title and draft contract. You’ll exchange contracts (at which point you’re legally committed and your deposit is transferred), and then complete on an agreed date, when the keys are yours.

The entire process from accepted offer to completion typically takes 8–16 weeks, though it can be shorter or longer depending on the chain and any complications. We’re with you throughout by chasing, problem-solving, and making sure nothing falls through the cracks.

Looking for London mortgage advice? Speak to us

At Bennison Brown, we’re a whole-of-market London mortgage broker, which means we’re not tied to any single lender. We search the full market, including high street banks, specialist lenders, and products you won’t find by going direct, to find the most suitable mortgage for your specific situation.

Whether you’re just starting to think about buying, need an Agreement in Principle quickly, or are ready to apply, our advisers are here to help. Our first-time buyer clients tell us that having expert guidance makes the whole process feel far less daunting, and often saves them significant money too.

Get in touch with us today by calling Bennison Brown on 0207 427 6067 or arrange your free, no-obligation consultation and let’s talk about what’s possible for you.

Frequently asked questions about first-time buyer mortgages in London

How much deposit do first-time buyers need in London?

The minimum deposit for most residential mortgages is 5% of the purchase price. In London, where the average first-time buyer property costs considerably more than the national average, that 5% represents a larger absolute sum. For example, on a £300,000 flat you’d need at least £15,000.

However, a 5% deposit comes with a higher interest rate than you’d access with a 10% or higher deposit. The sweet spot for many London first-time buyers is 10%. This unlocks significantly better rates and is achievable alongside using a Lifetime ISA or a gifted deposit from family. If you’re using the Mortgage Guarantee Scheme, 5% deposits are more widely available.

The best deposit level depends on your income, the property you’re targeting, and how long you’re prepared to save. At Bennison Brown, we’ll model different scenarios for you and show you the real monthly cost difference.

Can I get a mortgage as a first-time buyer buying a house alone?

Yes, absolutely. Buying alone in London is more challenging purely because one income has to stretch further, but it’s very common and entirely achievable on the right budget.

A single buyer earning £45,000 could access up to £202,500 at 4.5x income, or £225,000 at 5x income. Combined with a 10% deposit of around £22,000 to £25,000, that brings a purchase price of roughly £250,000 within reach. This suddenly becomes more achievable for a one-bedroom flat in several outer London boroughs.

If you’re buying alone and want to maximise your borrowing, it’s worth getting in touch to ask about lenders who offer higher income multiples to solo buyers, whether Shared Ownership could work for your situation, and whether a guarantor mortgage (where a family member’s income or assets are used to support your application) might be relevant.

Should I speak to a mortgage broker before viewing homes?

Yes! And this is one of the pieces of advice we give most consistently. Many of our clients come back to us or recommend us to family and friends because they saw the time-saving and financial value of our brokerage services. There are three reasons why having a broker matters in London specifically:

• You need to know your actual budget before you fall in love with a property. Many buyers look at properties in the wrong price range, get disappointed, and then struggle to adjust their expectations. A clear budget from the outset saves significant emotional energy!
• Many London estate agents won’t take offers seriously without an Agreement in Principle. Getting your AIP sorted before you start viewing means you’re ready to move immediately when you find the right place. In competitive areas, properties can go to best-and-final offers within days.
• Speaking to a broker early means any issues that might affect your application, such as a low credit score, gaps in employment, or a recent change of job, can be identified and addressed before they become problems at the point of application. This can save weeks of delay at the worst possible time.

Our mortgage consultation is free and without obligation. There is genuinely no downside to speaking to us early, and considerable upside in doing so. Unlock more competitive rates today by getting in touch.