This guide explains everything first-time buyers need to know: from how much it costs to buy an apartment in London to new build developments, Shared Ownership, and essential tips to avoid costly mistakes.
Saving for a deposit for an apartment in London
For most first-time buyers, saving for a deposit is the biggest hurdle when looking to buy an apartment in London. With high property prices, increasingly high rents, and the rising cost of living, it can feel like an uphill climb, but there are ways to make it more manageable.
How much do you need to buy an apartment in London?
Typically, you’ll need a 10% to 20% deposit based on the full market value of the property. For example:
£400,000 apartment → 10% deposit = £40,000
£600,000 apartment → 10% deposit = £60,000
This is often out of reach for many, especially when paying high London rents - but that’s where Shared Ownership can help.
Shared Ownership = smaller deposit
If you’re eligible for Shared Ownership, you can buy a 25% - 75% share of a new-build apartment rather than the full value upfront.
Example:
Apartment full price: £500,000
25% share = £125,000
10% deposit on £125,000 = £12,500
This means you can get on the property ladder with a much smaller deposit, making homeownership more realistic sooner.
Where to buy an apartment in London
London offers a huge variety of neighbourhoods to choose from, each with its own unique character, lifestyle, and price point.
If you’re looking for value and regeneration potential, areas like Newham, Barking & Dagenham, and Thamesmead are worth exploring.
These locations are seeing significant investment and offer lower entry prices compared to more central postcodes.
For example, Shared Ownership homes in West Ham Village and the upcoming Dagenham Green provide access to green spaces, new infrastructure, and quick transport links into central London - ideal for first-time buyers on a tighter budget.
Well connected central locations
If you're leaning toward a more central or well-established location, there are options too – though prices tend to be higher.
Areas like Islington, Notting Hill, and Wandsworth offer a premium lifestyle with excellent connectivity, boutique shops, and a vibrant social scene.
Peabody’s developments such as City Angel in EC1 and The Auria in W10 cater to those wanting contemporary apartments in sought-after zones.
South and East London
South and East London also strike a good balance between affordability and lifestyle. Places like Deptford, Southwark, and Greenwich combine culture, commuting ease, and riverside living.
Developments in these boroughs including Frankham Walk, St Olave’s, and Lombard Square are particularly appealing for first-time buyers wanting more space, access to green areas, and modern homes with long-term value.
Whether you're looking for a starter studio or a spacious two-bed with outdoor space, there’s a wide range of neighbourhoods across London that cater to different lifestyles, budgets, and buying goals.
Buy a flat in London through Shared Ownership
If saving for a full deposit feels out of reach, Shared Ownership can offer a more affordable route onto the London property ladder.
Rather than buying 100% of a home upfront, Shared Ownership lets you purchase a 25% to 75% share of a property and pay rent on the remainder. This dramatically reduces the size of the deposit you need because it’s based on your share, not the full market value.
It’s especially useful in London, and with this model, you can become a homeowner with a lower upfront cost, then gradually increase your share over time through a process called staircasing, potentially owning the home outright one day.
Another major benefit is that Shared Ownership properties are often new builds, offering modern layouts, energy-efficient design, and great amenities.
Purchasing costs of buying an apartment in London
Buying an apartment in London involves more than just saving for a deposit. It’s important to factor in other key costs that come with the purchase to budget accurately and avoid surprises.
From April 1, 2025, the Stamp Duty rules changed for all buyers, including first-time buyers:
First-time buyers pay 0% SDLT on the first £300,000 of the property price, then 5% on the portion between £300,001 and £500,000. Properties above £500,000 do not qualify for the first-time buyer relief, and the standard SDLT rates apply.
Non-first-time buyers and standard purchasers pay 0% SDLT up to £125,000, then 2% on £125,001 to £250,000, and 5% on £250,001 to £925,000, with higher rates on amounts above these thresholds.
For example, a first-time buyer purchasing a £400,000 apartment would pay 0% on the first £300,000 and 5% on the remaining £100,000 - a total of £5,000 in Stamp Duty.
You will need a solicitor or licensed conveyancer to handle the legal work, including property searches, contract reviews, and liaising with the seller’s representatives. Expect these fees to range from £1,500 to £2,500, with some variation depending on the complexity of the purchase.
Mortgage lenders typically charge arrangement or booking fees that range from £500 to £1,000. Additionally, you may pay valuation fees for the property assessment required by the lender. It’s important to include these in your budget, as well as potential fees for surveys or further checks.
Surveys help assess the property’s condition and uncover any potential issues. Basic homebuyer surveys usually cost around £300 to £500, while full structural surveys can exceed £1,000.
Service charges and ground rent: For flats, ongoing charges can vary significantly and should be factored into your monthly budgeting.
Moving costs: Removal services, utility transfers, and setting up new accounts all add to the total.
Mistakes to avoid when buying a flat in London
Buying a flat in London is a big step, and it’s easy to make missteps that can cost time and money. Here are some of the most common pitfalls to watch out for:
Many first-time buyers focus solely on the deposit and overlook the additional costs stated above like Stamp Duty, legal fees, service charges, and mortgage expenses. Failing to budget for these can delay your purchase or leave you financially stretched after moving in.
Most London apartments are leasehold, which means you're buying the right to live in the property for a set number of years, not the land itself. Always check the length of the lease, the ground rent, and service charges. A lease with fewer than 90 years remaining can make it harder to get a mortgage and reduce the property’s resale value.
Shared Ownership and Help to Buy (if eligible) can make buying more accessible, but many buyers dismiss these schemes without proper research. If you’re struggling to meet affordability thresholds, buying a share of a home might be a smarter first step than over-stretching for full ownership.
London is incredibly diverse, and choosing the right neighbourhood is just as important as the property itself. Think beyond just travel times, look into local amenities, regeneration plans, and community feel. Areas like Newham, Islington, Southwark, and Deptford all offer very different
Even with new builds, it's worth investing in a homebuyer’s survey to catch any structural or legal issues early. For older flats especially, this can help you avoid costly surprises down the line.
New build apartments for sale in London
New build apartments are a popular choice for first-time buyers in London - and for good reason. They offer modern design, energy efficiency, and peace of mind with building warranties.
Plus, many developments come with lifestyle perks such as concierge services, residents’ gyms, rooftop gardens, and co-working spaces.
One of the biggest advantages of buying a new build is the ease of moving in - everything is brand new, meaning less maintenance and no immediate renovations. For Shared Ownership buyers in particular, new builds offer a streamlined, low-hassle route onto the property ladder.
New build apartments from Peabody
Peabody, one of London’s most established housing providers, offers a wide range of thoughtfully designed new build developments across the capital.
Whether you're drawn to City Angel in Islington for its spa-style amenities and proximity to the City, or The Auria in Notting Hill for its West London charm, there’s a wide selection of locations and property types.
East London buyers might explore West Ham Village or Fish Island Point, while St Olave’s in Southwark and Frankham Walk and Deptford Edge in Deptford offer a strong mix of community, green space, and connectivity.
Frequently asked questions about buying an apartment in London
The cost of buying an apartment in London varies widely depending on location, size, and whether you’re purchasing outright or through schemes like Shared Ownership.
- Private sale apartments typically start from around £350,000 to £600,000+ for one or two bedrooms in outer or regenerating zones.
- With Shared Ownership, you can buy a 25% share of a home, with prices starting as low as £98,750 (for a quarter share of a £395,000 property), making homeownership far more accessible for first-time buyers.
It depends on your priorities. New build apartments offer modern layouts, better energy efficiency, and usually far fewer issues to deal with. They're great for first-time buyers who want a low-maintenance, move-in-ready home.
Older apartments may offer more space and character but could require renovation and come with higher maintenance costs. Lease lengths and building conditions are also important considerations. For peace of mind and modern living, many first-time buyers opt for new builds.
Several schemes are available to help first-time buyers in London:
- Shared Ownership: Buy a portion of a home (as low as 25%) and pay rent on the rest. This reduces both your deposit and mortgage requirements.
- First Homes scheme (subject to eligibility): Offers discounts on new-build homes for local first-time buyers and key workers.
- Stamp Duty relief: First-time buyers pay no Stamp Duty on the first £300,000 of a home’s value, and 5% on the portion up to £500,000.
These schemes can make buying your first home significantly more affordable.
Yes, non-UK citizens can buy property in London, including apartments. There are no legal restrictions on foreign ownership, but some mortgage lenders may have extra requirements or limitations for international buyers.
If you're purchasing without a mortgage, the process is even more straightforward. However, it’s essential to get legal advice and understand local tax implications, especially if buying as an investment.
