New-Build Deposits, Funding Options and Homebuying Support
There are several ways to fund a deposit when buying a new-build home, from personal savings and ISAs to gifted deposits, Deposit Boost, Shared Ownership and Discount Market Sale schemes.
Below, we answer common questions about how much deposit you may need, 5% deposit options and whether it is possible to buy with little or no deposit.
Can I use a Lifetime ISA to buy a new-build home?
Yes, you can use your Lifetime ISA savings, including the government bonus, towards a new build home purchase.
A Lifetime ISA can be a useful way for first-time buyers to build their deposit. The government bonus can increase the amount you have available, which may help with affordability and mortgage options.
Key points include:
- You must be a first-time buyer
- The property must be within scheme price limits
- The bonus adds 25% to your savings
This can significantly increase your deposit and improve your chances of securing a competitive mortgage on a property.
What is a gifted deposit and how does it work?
A gifted deposit is money given to you by a family member or friend to help fund your home purchase, with no expectation of repayment.
Gifted deposits are commonly used by first-time buyers who need support reaching the deposit required for a mortgage. Lenders usually need to confirm that the money is a genuine gift and not a loan.
Lenders will require:
- A signed gifted deposit declaration
- Proof of where the funds originated
This is a common and effective way for first-time buyers to bridge the gap to a required deposit when purchasing an Allison Homes home.
If a family member or friend is contributing to your deposit, Allison Homes will match their gift, helping you secure a more affordable mortgage or borrow more towards your dream Allison home.
What is Deposit Boost and how does it work?
Deposit Boost is a scheme where the developer contributes towards your deposit, helping you reach the required level for a mortgage.
This can make it easier to secure the deposit needed to buy a new build home. It can also help improve your Loan-to-Value position, which may support access to more mortgage options.
Deposit Boost can:
- Reduce the amount you need to save
- Improve your Loan-to-Value
- Unlock better mortgage rates
It’s designed to make buying a new build home more accessible, particularly for first-time buyers.
When buying with Allison Homes, your sales advisor can explain how Deposit Boost works and how it may support your home purchase.
Can I use a Help to Buy ISA to buy a new-build home?
Yes, if you already have a Help to Buy ISA, you can still use it towards your purchase and receive the government bonus.
Although the scheme is closed to new applicants, existing account holders can still benefit. The bonus can help increase your deposit and support your overall affordability.
This can:
- Increase your deposit
- Improve affordability
A mortgage advisor or solicitor can help you understand how your Help to Buy ISA savings fit into your purchase.
How much deposit do I need for a new-build home?
Typically, you’ll need a deposit of at least 5% to 10% of the property value, depending on lender criteria and property type.
For example, on a £280,000 home, a 5% deposit would be £14,000 and a 10% deposit would be £28,000. The deposit you need will depend on your mortgage options, affordability and the lender’s requirements.
There are several ways to make saving for a deposit more achievable. When buying with Allison Homes, you may be able to combine:
- Part Exchange
- Key Worker discount
- Deposit Boost schemes
- Gifted deposits from family
- Lifetime ISA or Help to Buy ISA savings
A mortgage advisor can help structure your deposit in the most effective way to support affordability and improve your mortgage options.
Can I buy a new-build home with a 5% deposit?
Yes, many lenders offer mortgages with a 5% deposit, especially for first-time buyers.
A 5% deposit can make buying a new build home more accessible, but approval will depend on your personal financial circumstances and the lender’s criteria.
Approval depends on:
- Credit history
- Income stability
- Lender criteria
Combining a 5% deposit with schemes such as Deposit Boost or ISAs can further strengthen your position when buying with Allison Homes.
A mortgage advisor can help confirm whether a 5% deposit mortgage is suitable for you.
Can I buy a new-build home with no deposit?
In most cases, you’ll still need a deposit to buy a new build home, but there are ways to reduce how much you need upfront.
While true zero deposit mortgages are very rare, many buyers can purchase with as little as 5% deposit, depending on their circumstances. Support options can help make the deposit more achievable.
Options that can help include:
- Deposit Boost schemes
- Gifted deposits from family
- Lifetime ISA savings with government bonus
When buying with Allison Homes, available incentives may help reduce your upfront costs and make homeownership more accessible.
Speaking to a mortgage advisor early can help you understand what level of deposit is realistically achievable for you.
Can I part exchange my home?
Yes, part exchange allows you to sell your current home directly to the developer, avoiding the need to find a buyer yourself.
Instead of listing your property on the open market, the developer purchases it from you and uses its value towards your new home. This removes the uncertainty of chains and significantly speeds up the process.
When buying with Allison Homes:
- Your property is assessed using three independent estate agent valuations
- You receive a fair, market-aligned offer
- Allison Homes becomes your guaranteed buyer
Key advantages:
- No estate agent fees
- No risk of your sale falling through
- You can remain in your home until your new build is ready
This makes part exchange one of the most convenient and low-stress ways to move into a new build home.
What incentives do new-build developers offer?
Developers often provide incentives to help reduce upfront costs and make moving home more affordable and straightforward.
These incentives vary by development and availability, but they are designed to support buyers at different stages of the buying journey. They can be especially helpful for first-time buyers, families moving up the ladder or homeowners who want a smoother move.
Incentives can include:
- Deposit contributions, such as Deposit Boost
- Stamp Duty contributions
- Part Exchange schemes
- Upgrades or flooring packages
- Assisted move options
These can:
- Reduce the amount of deposit you need upfront
- Improve affordability
- Simplify the moving process
When buying with Allison Homes, incentives are designed to support buyers at different stages, whether you’re a first-time buyer or moving up the ladder.
It’s always worth asking what offers are currently available, as they can make a significant difference to your overall budget and buying experience.
What is shared ownership and how does it work?
Shared ownership allows you to buy a percentage of a home and pay rent on the remaining portion.
This can make buying a new build home more accessible, particularly for first-time buyers who may not be able to afford the full purchase price straight away. You buy an initial share and may have the option to increase your ownership later.
Typical structure:
- Buy 25% to 75% of the property
- Pay subsidised rent on the rest
- Option to increase ownership over time, known as staircasing
Shared ownership can reduce the deposit and mortgage amount needed at the start, helping more buyers take a first step onto the property ladder.
