Doulton Bridging Finance
New Build Mortgages — Deposit Guide

How Much Deposit Do You Need for a New Build Mortgage? 2026 Guide

How much deposit for a new build mortgage 2026 — houses vs flats, 5% routes, incentive impact, LISA boost, worked examples at £250k, £350k, £500k. Doulton Bridging Finance.

The minimum deposit for a new build house is 5% via the Mortgage Guarantee Scheme or Own New Rate Reducer on participating developments. For new build flats, the minimum is typically 15%–25%. These are higher than the equivalent resale minimums — new build lenders are more conservative on LTV because new build properties can carry a price premium that may not be reflected in independent valuations. Understanding the deposit requirement for your specific property and development — and how developer incentives affect the effective deposit needed — is one of the most important steps before choosing your new build home.

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5%
Minimum deposit — new build house via MGS or Rate Reducer
15%–25%
Minimum deposit — new build flat (lender-dependent)
5%
5% incentive threshold — above this, lender reduces valuation base
£1,000/yr
Maximum LISA government bonus adding to your deposit
Current rates · Updated August 2026Residential Mortgage Rates 2026UK residential mortgage rates in 2026 range from 4.33% for the best 2-year fix (Danske Bank, 60% LTV, August 2026) to above 6% for high-LTV or complex income cases.
View the rate guide
NEW BUILD MORTGAGES — DEPOSIT GUIDE

How developer incentives affect your effective deposit

If the developer offers incentives worth more than 5% of the purchase price (cashback, paid stamp duty, furniture, upgrades), the lender reduces the property value it uses for LTV calculations by the excess amount. Example: £40,000 incentive on a £400,000 property = 10%. The lender reduces its base to £380,000 (£400,000 minus the £20,000 excess above 5%). At 90% LTV on £380,000 = £342,000 loan. Deposit required: £400,000 - £342,000 = £58,000 (14.5%), not 10%. Always declare all incentives to DBF before we calculate your deposit requirement. Non-disclosure is mortgage fraud.

Deposit sources for new build

Savings (bank or LISA): straightforward. Gifted deposit from family: accepted by most lenders with a gifted deposit letter confirming no repayment obligation. LISA bonus: £1,000/year government bonus added to saved amount. Own New Rate Reducer: the developer contribution is not a deposit — it reduces your rate, not your borrowing requirement. Equity from existing property: used for home movers via a remortgage or bridge. Help from family via JBSP (Joint Borrower Sole Proprietor): parent income supports affordability without being on title.

Deposit table — worked examples by purchase price

The worked examples in the rate table below show exact deposit requirements at three price points. Use these as the starting model — your specific property may have different LTV limits based on lender, property type, and any incentives. DBF calculates your exact deposit requirement from the specific property details.

New Build Deposit Requirements by Property Type and LTV — August 2026

Property typeMin deposit (scheme)Min deposit (standard)Notes
New build house (FTB or mover)5% via MGS or Rate Reducer10%–15% standard95% LTV via MGS. Rate Reducer requires 10%+ on most lenders.
New build flat (standard)15% (85% LTV)20%–25% (many lenders)EWS1 required if building over 11m. Some lenders cap at 75% LTV for flats.
New build flat (no EWS1)25% or specialist lender25%+ or specialist lenderVery few mainstream lenders proceed at high LTV without EWS1.
New build BTL (house)25% standard25% standardICR test applies. 25% deposit is standard across BTL lenders.
New build BTL (flat)25%–30%25%–30%Higher deposit than residential flat. Site exposure limits apply.
Shared ownership new build5% of share purchased5% of share purchasedDeposit is on purchased share only — not full property value.

Worked example

Three purchase prices — deposit requirements compared:

  • New build house £250,000:
  • 5% deposit (MGS): £12,500. Mortgage: £237,500 at 5.20% = £1,449/month.
  • 10% deposit (standard): £25,000. Mortgage: £225,000 at 4.52% = £1,244/month.
  • Rate Reducer (10% dep, 80% LTV): £50,000 dep. Mortgage: £200,000 at 1.87% = £836/month.
  • New build house £350,000:
  • 5% deposit (MGS): £17,500. Mortgage: £332,500 at 5.20% = £2,029/month.
  • 10% deposit: £35,000. Mortgage: £315,000 at 4.52% = £1,742/month.
  • New build flat £350,000:
  • 15% deposit (85% LTV min): £52,500. Mortgage: £297,500 at 4.75% = £1,607/month.
  • 25% deposit: £87,500. Mortgage: £262,500 at 4.20% = £1,287/month.
The Process

How it works

01

Tell us about your purchase

Share the property details, development, scheme type (Rate Reducer, MGS, shared ownership), and your deposit. We assess your situation same working day.

02

Lender search and scheme check

We identify which lenders accept your income type, development, and property classification — including Rate Reducer and MGS eligibility where relevant.

03

Application and valuation

We manage the full application, coordinate the RICS valuation, and liaise with the developer on build schedule and offer validity.

04

Mortgage offer and completion

Once the offer is issued, we monitor build progress, manage any extensions needed for off-plan delays, and coordinate completion.

FAQs

Frequently asked questions

What is the minimum deposit for a new build house in 2026?

5% via the Mortgage Guarantee Scheme (on houses up to £600,000) or via Own New Rate Reducer on participating developments. Without scheme access, 10%–15% is the standard minimum for most mainstream lenders on new build houses.

What is the minimum deposit for a new build flat?

15% (85% LTV) is the minimum for most lenders on new build flats. Some lenders cap at 25% (75% LTV), particularly where EWS1 certification is not available. DBF identifies the lender with the highest LTV for your specific flat.

Do developer incentives affect how much deposit I need?

Yes — incentives above 5% of the purchase price cause the lender to reduce the property value it uses for LTV. This effectively increases the deposit required. Always tell DBF about all incentives before we calculate your deposit requirement.

Can a gifted deposit be used for a new build?

Yes — gifted deposits from family members are accepted by most new build lenders. A gifted deposit letter confirming no repayment obligation is required. DBF knows which lenders have the most flexible gifted deposit policies.

How does a LISA boost my new build deposit?

Your LISA savings plus the 25% government bonus (up to £1,000/year) can be added to your deposit. On a £450,000 property (LISA price cap), LISA savings of £12,000 over 3 years attract £3,000 in government bonus — adding £3,000 to your effective deposit for free. LISA can combine with MGS for maximum accessibility.

Related finance

Explore related pages

New Build Mortgages Hub

New build mortgages 2026 — specialist whole-of-market broker. Lower LTV, scheme expertise, off-plan offer validity, Own New Rate Reducer.

Own New Rate Reducer

Own New Rate Reducer 2026 — mortgage rates from 1.87% on new build properties. DBF works with Own New participating developments. Compare Rate…

Mortgage Guarantee Scheme

Mortgage Guarantee Scheme for new builds 2026 — permanent from July 2025, 95% LTV, up to £600,000. Which lenders? How to apply.

New Build Mortgage Rates 2026

New build mortgage rates 2026 — best buys by LTV for houses and flats. Own New Rate Reducer comparison. Monthly payment examples. Updated August 2026.

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