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How to save for a house deposit faster
Saving for a house deposit is one of the biggest financial challenges facing first time buyers today. But with the right approach, you can accelerate your savings journey and bring homeownership closer.
Here are five handy tips on how you can knock those savings goals out of the park in 2025.
1. Understand your deposit goal
Start by understanding how much you need to save. Most lenders will require a minimum of 5% of the total property price as a deposit, although saving more can open up better mortgage deals and lower interest rates.
For the average £269,000 property, this looks like:
- 5% deposit: £13,450
- 10% deposit: £26,900
- 20% deposit: £53,800
Not sure how much is realistic for you? Use Tembo’s mortgage calculator to see how different deposit sizes would impact your affordability, as well as indicative interest rates and monthly repayments.
2. Make the most of tax-free saving
A Lifetime ISA (LISA) is one of the most effective ways to build your deposit. You can save up to £4,000 each tax year and benefit from a free 25% government bonus — that’s up to £1,000 extra every year! With Tembo, your Cash LISA savings also benefit from a market-leading 4.60% AER (variable) interest rate.
However, buying your first home comes with more than just a deposit. From Stamp Duty to removal costs, a Cash ISA is a smart way to save tax-free for these essential extras. Tembo’s Cash ISA offers 4.80% AER (variable) with no introductory rates, penalties, or fees.
You must be aged 18-40 to open a LISA, and can only be used for your first home purchase or retirement. Ineligible withdrawals may return less than paid in. Tax treatment depends on individual circumstances and may be subject to change in the future. Tembo Cash ISA is not flexible. Any funds withdrawn & re-deposited within the same tax year may count towards ISA allowance twice.
3. Automate your savings
Set up a direct debit to add funds to your savings account each month – ideally just after payday. Automating this process ensures you stay on track, and removes the temptation to spend those all-important savings throughout the month (we all have it…)
4. Use every opportunity to save
If your birthday or a special occasion is coming up, consider asking friends and family to contribute towards your deposit savings, rather than buying you a gift. Most people are more than happy to support a meaningful goal — especially one as significant as your first home!
Our Gift Link feature allows your loved ones to securely add money directly to your LISA using a secure payment link. One simple link, without needing to swap sort codes — and you’re one step closer to owning your own place. Download the Tembo app here to check out your Gift Link!
5. Explore your options
With the average buyer now needing almost 10 years to save for a deposit, there’s been more innovation in the market than ever. Consider new budget-boosting schemes that are designed to support first-time buyers onto the property ladder, like:
Each scheme offers different benefits and eligibility criteria. Start by exploring all your options to see which is the best fit for you.
Come talk to us at the Manchester Home Show!
Getting on the property ladder isn’t easy — but the right support can make all the difference. That’s why we’re heading to the Manchester Home Show, ready to chat with first-time buyers about how Tembo can help them buy their first home, faster.
Visit us at the show and discover how Tembo can help you get closer to the keys to your first home.
Attend the Manchester Home Show
Tickets for the Manchester Home Show are free, but visitors must register in advance to attend. For more information, or to reserve your place at the capital’s no.1 first time buyer event, please visit the Eventbrite page.
Share to Buy lists thousands of affordable properties across the country, including those available through Shared Ownership, Rent to Buy and Discount Market Sale. Learn more about the different buying and rental schemes available today.
