Quick Reference: Salary-to-Borrowing Table
This table shows the typical maximum mortgage based on income multiples of 4x and 4.5x, the two most common lending limits. Your actual offer will depend on credit score, outgoings, deposit size, and lender criteria.
| Annual Salary | Max Mortgage (4x) | Max Mortgage (4.5x) | 5% Deposit Needed | 10% Deposit Needed | Max Property Price (4.5x + 10% deposit) |
|---|---|---|---|---|---|
| £25,000 | £100,000 | £112,500 | £5,921 | £12,500 | £125,000 |
| £30,000 | £120,000 | £135,000 | £7,105 | £15,000 | £150,000 |
| £35,000 | £140,000 | £157,500 | £8,289 | £17,500 | £175,000 |
| £40,000 | £160,000 | £180,000 | £9,474 | £20,000 | £200,000 |
| £45,000 | £180,000 | £202,500 | £10,658 | £22,500 | £225,000 |
| £50,000 | £200,000 | £225,000 | £11,842 | £25,000 | £250,000 |
| £55,000 | £220,000 | £247,500 | £13,026 | £27,500 | £275,000 |
| £60,000 | £240,000 | £270,000 | £14,211 | £30,000 | £300,000 |
| £70,000 | £280,000 | £315,000 | £16,579 | £35,000 | £350,000 |
| £80,000 | £320,000 | £360,000 | £18,947 | £40,000 | £400,000 |
Key notes:
- The 5% deposit column shows what you need for a 95% LTV mortgage (mortgage = 95% of property price)
- The 10% deposit column is simply 10% of the max property price at 4.5x
- First-time buyers in England pay no stamp duty on properties up to £300,000 (as of April 2025), and reduced rates up to £500,000
- Some lenders offer up to 5x or 5.5x income for higher earners or specific professionals — see the affordability guide for details
Single Income Worked Examples
These examples show realistic scenarios for single first-time buyers at different salary levels, including what you can borrow, what properties are accessible, and what the monthly budget looks like.
Example 1: £28,000 Salary (Median UK Salary for Under 30s)
| Item | Amount | Notes |
|---|---|---|
| Annual salary | £28,000 | Gross, before tax |
| Monthly take-home pay | £1,887 | After tax, NI, student loan (Plan 2) |
| Maximum mortgage (4.5x) | £126,000 | Many lenders will cap at 4x = £112,000 |
| Savings available | £15,000 | Including £4,000 LISA bonus |
| Less legal fees and moving costs | -£3,500 | Solicitor, searches, moving van |
| Deposit available | £11,500 | 7.7% of a £150,000 property |
| Maximum property price | £137,500 | £126,000 mortgage + £11,500 deposit |
What this buys: A one or two-bedroom new build flat or shared ownership property in the Midlands, North West, North East, Yorkshire, or Wales. Unlikely to reach a new build house in most areas. In London and the South East, shared ownership is the most realistic route.
Monthly budget at £137,500 (5.5% rate, 30-year term):
| Expense | Monthly Cost | % of Take-Home |
|---|---|---|
| Mortgage payment | £715 | 37.9% |
| Council tax (Band A-B) | £110 | 5.8% |
| Energy bills | £85 | 4.5% |
| Water | £35 | 1.9% |
| Buildings insurance | £25 | 1.3% |
| Service charge (new build flat) | £150 | 7.9% |
| Total housing costs | £1,120 | 59.4% |
| Remaining for food, transport, life | £767 | 40.6% |
Reality check: Housing costs at nearly 60% of take-home is above the recommended 35-40%. This buyer would benefit from shared ownership (lower monthly costs) or waiting to build a larger deposit. A LISA with £4,000/year contributions plus the 25% government bonus could add £5,000/year to savings.
Example 2: £35,000 Salary
| Item | Amount | Notes |
|---|---|---|
| Annual salary | £35,000 | Gross |
| Monthly take-home pay | £2,318 | After tax, NI, student loan |
| Maximum mortgage (4.5x) | £157,500 | |
| Savings available | £22,000 | Including LISA bonus |
| Less costs | -£4,000 | Legal, moving, initial furnishing fund |
| Deposit available | £18,000 | 10% of £180,000 |
| Maximum property price | £175,500 | £157,500 + £18,000 |
What this buys: A two-bedroom new build flat in most areas outside London, or a two to three-bedroom new build terraced house in the North East, parts of Yorkshire, North West, and East Midlands. Could reach a three-bedroom semi in the most affordable areas.
Monthly budget at £175,000 (5.25% rate, 30-year term):
| Expense | Monthly Cost | % of Take-Home |
|---|---|---|
| Mortgage payment | £869 | 37.5% |
| Council tax (Band B-C) | £140 | 6.0% |
| Energy bills | £95 | 4.1% |
| Water | £38 | 1.6% |
| Buildings insurance | £28 | 1.2% |
| Service charge (if applicable) | £100 | 4.3% |
| Total housing costs | £1,270 | 54.8% |
| Remaining for food, transport, life | £1,048 | 45.2% |
Reality check: More comfortable than the £28k example, but still above the ideal 35-40% housing cost ratio. Manageable if you have low debt and modest lifestyle costs. A 10% deposit improves your mortgage rate, saving approximately £30-£50/month compared to 5%.
Example 3: £50,000 Salary
| Item | Amount | Notes |
|---|---|---|
| Annual salary | £50,000 | Gross |
| Monthly take-home pay | £3,169 | After tax, NI |
| Maximum mortgage (4.5x) | £225,000 | Some lenders may offer 4.75x = £237,500 |
| Savings available | £30,000 | |
| Less costs | -£5,000 | Legal, moving, furnishing fund |
| Deposit available | £25,000 | 10% of £250,000 |
| Maximum property price | £250,000 |
What this buys: A three-bedroom new build semi-detached or terraced house in most areas outside London and the South East. In the Midlands, North, Yorkshire, and Wales, you could reach a three-bedroom detached. In the South East, this typically buys a two-bedroom flat or a three-bedroom terraced house in less expensive towns.
Monthly budget at £250,000 (5.0% rate, 30-year term):
| Expense | Monthly Cost | % of Take-Home |
|---|---|---|
| Mortgage payment | £1,208 | 38.1% |
| Council tax (Band C-D) | £170 | 5.4% |
| Energy bills | £110 | 3.5% |
| Water | £42 | 1.3% |
| Buildings insurance | £32 | 1.0% |
| Estate management fee | £80 | 2.5% |
| Total housing costs | £1,642 | 51.8% |
| Remaining for food, transport, life | £1,527 | 48.2% |
Reality check: This is the sweet spot for new build purchasing as a single buyer. Housing costs are still above the ideal ratio but manageable with careful budgeting. The £1,527 remaining is enough for a reasonable lifestyle if you don't have significant debt.
Joint Income Worked Examples
Joint applications significantly increase borrowing power. Lenders assess the combined income, which typically opens up the three and four-bedroom new build market.
Example 4: Combined Income £55,000 (£30k + £25k)
| Item | Amount |
|---|---|
| Combined salary | £55,000 |
| Combined take-home | £3,640 |
| Maximum mortgage (4.5x) | £247,500 |
| Combined savings | £35,000 |
| Less costs | -£5,500 |
| Deposit available | £29,500 (10.6% of £278,000) |
| Maximum property price | £277,000 |
What this buys: A three-bedroom new build semi-detached in most regions. Could reach a three or four-bedroom detached in the North East, parts of Yorkshire, and the East Midlands. Shared ownership could stretch to a four-bedroom detached in more expensive areas.
Example 5: Combined Income £70,000 (£40k + £30k)
| Item | Amount |
|---|---|
| Combined salary | £70,000 |
| Combined take-home | £4,522 |
| Maximum mortgage (4.5x) | £315,000 |
| Combined savings | £45,000 |
| Less costs | -£6,500 |
| Deposit available | £38,500 (10.9% of £353,500) |
| Maximum property price | £353,500 |
What this buys: A three to four-bedroom new build detached in most areas outside London and premium South East locations. In the Midlands and North, this comfortably reaches four-bedroom detached homes from volume housebuilders. In the South East, expect three-bedroom semi-detached or terraced.
Example 6: Combined Income £90,000 (£55k + £35k)
| Item | Amount |
|---|---|
| Combined salary | £90,000 |
| Combined take-home | £5,568 |
| Maximum mortgage (4.5x) | £405,000 |
| Combined savings | £60,000 |
| Less costs | -£8,000 |
| Deposit available | £52,000 (11.4% of £457,000) |
| Maximum property price | £457,000 |
What this buys: Four-bedroom detached new builds from all major developers in most of England and Wales. In London, this reaches two to three-bedroom flats or houses in outer boroughs. In premium South East locations (Surrey, Berkshire, Hertfordshire), expect three-bedroom semi-detached to four-bedroom terraced.
Joint Income Comparison Summary
| Combined Income | Max Mortgage (4.5x) | Max Property (10% deposit) | Typical New Build Accessible |
|---|---|---|---|
| £45,000 | £202,500 | £225,000 | 2-bed flat or 2-3 bed terrace (North/Midlands) |
| £55,000 | £247,500 | £277,000 | 3-bed semi (most regions) |
| £65,000 | £292,500 | £325,000 | 3-4 bed semi/detached (Midlands/North) |
| £75,000 | £337,500 | £375,000 | 4-bed detached (most regions ex-London/SE) |
| £90,000 | £405,000 | £450,000 | 4-bed detached (most of England and Wales) |
| £110,000 | £495,000 | £550,000 | 4-5 bed detached or premium locations |
Monthly Budget Reality Check
Knowing what you can borrow is different from knowing what you can afford. Lenders approve mortgages based on income multiples and stress tests, but they don't account for how you actually live. Here's a realistic monthly budget framework.
The 40/30/30 Rule for New Build Buyers
A sensible budget for first-time buyers in a new build:
| Category | % of Take-Home | What It Covers |
|---|---|---|
| Housing costs | 35-40% | Mortgage, council tax, insurance, service charge, energy, water |
| Living costs | 30-35% | Food, transport, phone, subscriptions, clothing, personal |
| Savings and flexibility | 25-30% | Emergency fund, future maintenance, holidays, social, debt repayment |
New Build-Specific Monthly Costs to Budget For
These costs are often forgotten by first-time buyers buying new builds:
| Cost | Monthly Range | Why It Catches Buyers Out |
|---|---|---|
| Estate management/service charge | £80-£350 | Not included in mortgage affordability checks. Can increase annually without cap |
| Flooring (spread over 12 months) | £250-£650 | Many new builds have no floor coverings. Budget £3,000-£8,000 |
| Garden (spread over 6 months) | £200-£500 | Bare soil is common. Turf, fencing, and patio: £2,000-£5,000 |
| Curtains/blinds | £100-£250 | Window treatments for a 3-bed: £1,000-£3,000 |
| Furniture essentials | £200-£500 | Empty rooms need furniture. Budget £3,000-£6,000 minimum |
| Appliances (if not included) | £80-£200 | Washing machine, fridge/freezer, oven if not in specification |
Critical insight: In the first 6-12 months of owning a new build, your actual monthly costs will be £500-£1,500 higher than your ongoing housing costs because of these one-off purchases spread over time. Factor this into your affordability assessment — not just what the lender says you can borrow.
Regional Affordability: What Your Budget Buys
The same salary buys very different properties depending on where you're looking. This table shows what a typical first-time buyer budget reaches in each region.
| Region | New Build 2-Bed Flat | New Build 3-Bed Semi | New Build 4-Bed Detached | Salary Needed (4.5x, 10% deposit) |
|---|---|---|---|---|
| North East | £120,000-£160,000 | £175,000-£230,000 | £240,000-£320,000 | £24k / £35k / £48k-£64k |
| Yorkshire | £130,000-£180,000 | £190,000-£260,000 | £270,000-£370,000 | £26k / £38k-£52k / £54k-£74k |
| North West | £140,000-£190,000 | £200,000-£280,000 | £280,000-£400,000 | £28k-£38k / £40k-£56k / £56k-£80k |
| East Midlands | £140,000-£185,000 | £210,000-£280,000 | £290,000-£390,000 | £28k-£37k / £42k-£56k / £58k-£78k |
| West Midlands | £150,000-£200,000 | £220,000-£300,000 | £300,000-£420,000 | £30k-£40k / £44k-£60k / £60k-£84k |
| Wales | £130,000-£180,000 | £190,000-£260,000 | £260,000-£360,000 | £26k-£36k / £38k-£52k / £52k-£72k |
| South West | £170,000-£230,000 | £260,000-£350,000 | £360,000-£500,000 | £34k-£46k / £52k-£70k / £72k-£100k |
| East of England | £180,000-£250,000 | £280,000-£380,000 | £380,000-£520,000 | £36k-£50k / £56k-£76k / £76k-£104k |
| South East | £200,000-£300,000 | £320,000-£430,000 | £430,000-£600,000+ | £40k-£60k / £64k-£86k / £86k-£120k+ |
| London | £300,000-£450,000 | £450,000-£600,000+ | £600,000-£900,000+ | £60k-£90k / £90k-£120k+ / £120k-£180k+ |
| Scotland | £130,000-£200,000 | £200,000-£280,000 | £280,000-£400,000 | £26k-£40k / £40k-£56k / £56k-£80k |
How to read this table: The "Salary Needed" column shows the approximate single income required at 4.5x multiple with a 10% deposit. For joint applications, the combined income applies. For example, a couple earning £60,000 combined in the East Midlands could reach a three to four-bedroom new build property.
The True Cost Beyond the Mortgage
First-time buyers consistently underestimate costs. Here's a comprehensive breakdown of everything you'll spend on a £250,000 new build purchase.
| Cost | Amount | When Paid | Notes |
|---|---|---|---|
| Deposit (10%) | £25,000 | Reservation + exchange | Reservation fee (£500-£1,000) deducted from this |
| Solicitor fees + disbursements | £1,800-£2,500 | During transaction | Includes searches, Land Registry, bank transfer fees |
| Stamp duty | £0 | On completion | FTBs pay nothing up to £300,000 |
| Mortgage arrangement fee | £0-£1,000 | On application or added to mortgage | Fee-free products available but may have higher rates |
| Mortgage valuation | £0-£300 | On application | Many lenders offer free valuations for new builds |
| Moving costs | £500-£1,500 | Completion week | Van hire or removal company |
| Flooring throughout | £3,000-£8,000 | First 3 months | Often not included in new build specification |
| Curtains and blinds | £1,000-£3,000 | First month | Every window needs covering |
| Garden landscaping | £1,500-£4,000 | First 6 months | Turf, fencing, basic planting, patio |
| Essential furniture | £3,000-£8,000 | First 6 months | Beds, sofa, dining table, storage |
| Appliances (if not included) | £1,000-£3,000 | Before/on move-in | Fridge, washing machine, dryer, dishwasher |
| Emergency fund | £2,000-£5,000 | Before completion | 3 months' essential costs as safety net |
| Total beyond deposit | £13,800-£36,300 | The deposit is only part of what you need |
For a £250,000 new build, the total cash needed is approximately £38,800-£61,300 (deposit plus all additional costs). This is why so many first-time buyers feel stretched in their first year — they budgeted for the deposit but not for everything else.
How to Stretch Your Borrowing
If the salary-to-property tables show you can't quite reach what you need, these strategies can bridge the gap.
| Strategy | Potential Impact | How It Works | Considerations |
|---|---|---|---|
| Clear existing debt | +£5,000-£30,000 borrowing | Lenders deduct monthly debt payments from affordability. Clearing a £200/month car loan could add £10,000-£15,000 to your mortgage | Clear debts at least 3 months before applying |
| Longer mortgage term | Lower monthly payments | 35-year term instead of 25-year reduces monthly payment by ~15%. Some lenders now offer 40 years | You pay more interest overall and build equity slower |
| Higher income lender | +£10,000-£50,000 borrowing | Some lenders offer 4.75x or 5x for certain professionals (doctors, lawyers, accountants) or higher earners | Usually requires a clean credit history and higher deposit |
| Lifetime ISA bonus | +£1,000/year (max £33,000) | 25% government bonus on up to £4,000/year savings, available to under-40s | Must be open for 12 months before use. Penalty for non-property withdrawal |
| Shared ownership | Buy 25-75% of the property | Lower deposit and mortgage needed. Pay rent on the share you don't own | Monthly costs can be higher than full ownership. Selling is more complex |
| First Homes scheme | 30-50% discount | New build properties sold at 30-50% below market value to eligible first-time buyers | Limited availability. Discount is locked to the property permanently |
| Negotiate developer incentives | Save £5,000-£20,000 | Legal fees paid, stamp duty contribution, flooring included, appliances included | Incentives over 5% of purchase price may affect mortgage. See our incentives guide |
| Family gift or guarantor | Variable | Family members can gift deposit money or act as guarantors to unlock higher borrowing | Lenders require a gifted deposit letter. Guarantors take on significant liability |
New Build-Specific Borrowing Factors
Buying a new build affects your borrowing in ways that don't apply to resale properties.
How New Builds Affect Your Mortgage
| Factor | Impact | What to Do |
|---|---|---|
| New build premium | You're borrowing more than for an equivalent resale | Ensure the premium is within 15-25% — above this, you risk a down-valuation |
| Incentives and lending caps | Incentives over 5% reduce your effective borrowing | Ask your broker to calculate the net impact before accepting incentives |
| Mortgage offer validity | Offers expire in 3-6 months; new builds may not complete in time | Time your full application to align with the build schedule. See our mortgage timeline guide |
| Limited lender choice | Some lenders restrict new build lending (max LTV, specific developers) | Use a whole-of-market broker with new build experience |
| Valuation risk | Down-valuations are more common on new builds (10-15%) | Have a strategy ready. See our down-valuation guide |
| Energy efficiency benefit | Some lenders offer "green" mortgages with higher borrowing for efficient homes | New builds with EPC A or B may qualify for enhanced borrowing of up to 5x income |
Government Schemes That Boost Your Budget
Several schemes specifically help first-time buyers reach new build properties.
| Scheme | How It Helps | Eligibility | Impact on Budget |
|---|---|---|---|
| Lifetime ISA | 25% government bonus on savings up to £4,000/year | Age 18-39 to open; use by age 60 for property up to £450,000 | Maximum £33,000 bonus over lifetime if opened at 18 |
| Shared Ownership | Buy 25-75% share; rent the rest from housing association | Household income under £80,000 (£90,000 in London) | Deposit of 5-10% on your share only. £250k home at 50% = £12,500 deposit |
| First Homes | 30-50% discount on new build price | First-time buyers; local connection may apply; price cap after discount £250k (£420k London) | A £300,000 home at 30% discount = £210,000 purchase price |
| Deposit Unlock | Allows 5% deposit on new builds with enhanced terms | Participating developers and lenders | Reduces savings needed; 5% of £250,000 = £12,500 vs £25,000 at 10% |
| Mortgage Guarantee Scheme | Government backs 95% LTV mortgages | Properties up to £600,000; available to all buyers | Access to 5% deposit mortgages from major lenders |
| Right to Buy / Right to Acquire | Discounts on social housing purchase | Council or housing association tenants | Discounts of £16,000-£96,000+ depending on area and tenancy length |
For a detailed guide on combining schemes with developer incentives, see our stacking savings guide.
How Existing Debt Reduces What You Can Borrow
Lenders subtract your existing monthly debt commitments from their affordability calculation. This has a larger impact than most buyers realise.
| Debt Type | Monthly Payment | Reduction in Max Mortgage | Action |
|---|---|---|---|
| Car finance (PCP/HP) | £250/month | -£12,000 to -£18,000 | If possible, clear before applying or factor into budget |
| Student loan (Plan 2) | £100-£200/month | -£5,000 to -£12,000 | Can't clear — lenders factor this in automatically |
| Credit card minimum payments | £50-£150/month | -£3,000 to -£9,000 | Clear balances or close unused cards 3+ months before applying |
| Personal loan | £150/month | -£8,000 to -£12,000 | Clear if possible; if not, include in affordability planning |
| Buy Now Pay Later | Variable | -£2,000 to -£8,000 | Clear all BNPL before applying — some lenders view it negatively even at £0 balance |
| Childcare costs | £500-£1,500/month | -£25,000 to -£80,000 | This is the single biggest affordability reducer. Factor in carefully |
Example: A buyer earning £40,000 with a 4.5x multiple can theoretically borrow £180,000. But with a £250/month car payment and £100/month student loan, the effective maximum drops to approximately £155,000-£165,000. That's a potential reduction of £15,000-£25,000 in what you can spend on a property.
How Different Income Types Affect Borrowing
Not all income is treated equally by mortgage lenders. Understanding how your specific income type is assessed helps you calculate a realistic borrowing figure.
| Income Type | How Lenders Assess It | Typical Multiple | What You Need |
|---|---|---|---|
| Employed (PAYE) | Basic salary fully counted; regular overtime and bonuses usually counted at 50-100% | 4-4.5x (up to 5x with some lenders) | 3 months' payslips + P60 |
| Self-employed (sole trader) | Average of last 2-3 years' net profit. Some lenders use the higher year | 4-4.5x of average profit | 2-3 years' SA302s + tax year overviews |
| Self-employed (limited company) | Salary + dividends. Some lenders also consider retained profits | 4-4.5x of salary + dividends | 2-3 years' company accounts + SA302s |
| Contractor (day rate) | Specialist lenders annualise the day rate (e.g., £400/day x 5 x 46 weeks = £92,000) | 4-4.5x of annualised rate | Current contract + 12 months' contracting history |
| Zero-hours / variable | Average of last 12 months' income. Some lenders won't consider | 3.5-4x of average | 12 months' payslips + bank statements |
| Benefits income | Some benefits counted (child benefit, working tax credits). Others excluded | Varies by lender and benefit type | Award letters + bank statements showing receipt |
| Overtime / commission | Usually 50-100% of regular overtime/commission averaged over 12 months | Added to base salary for multiple calculation | 12 months' payslips showing consistent pattern |
Tip for self-employed buyers: If your income has been growing, some lenders will use the latest year rather than the average. A specialist broker can identify which lenders are most favourable for your income profile. See our mortgage approval guide for detailed self-employed advice.
Frequently Asked Questions
Can I borrow more than 4.5x my salary?
Some lenders offer up to 5x, 5.5x, or even 6x for certain buyer profiles. Higher multiples are typically available for: professionals in specific fields (doctors, lawyers, accountants, vets), higher earners (usually £50,000+), buyers with large deposits (25%+), and through specific "green mortgage" products for energy-efficient new builds. A whole-of-market broker can identify which lenders stretch beyond 4.5x for your situation.
Does a new build affect how much I can borrow?
The property being new build doesn't directly change how much you can borrow, but it affects the process. Some lenders have lower maximum LTV ratios for new builds (e.g., 85% instead of 95%), and developer incentives exceeding 5% of the purchase price effectively reduce what you can borrow. On the positive side, the energy efficiency of new builds may qualify you for "green mortgage" products with higher income multiples.
Should I borrow the maximum I'm offered?
Generally, no. Just because a lender will offer you £250,000 doesn't mean you should borrow £250,000. Use the monthly budget tables in this guide to check whether the payments are genuinely comfortable alongside your real living costs. A good rule: if housing costs exceed 40% of your take-home pay, you're stretching too far.
How much deposit do I really need for a new build?
Minimum 5% through schemes like Deposit Unlock and the Mortgage Guarantee Scheme. However, 10% significantly improves your mortgage rate (saving £30-£60/month on a typical mortgage) and gives you more lender choice. 15% and 20% unlock even better rates. For a detailed comparison, see our deposit guide.
Do all lenders assess income the same way?
No — and this is one of the biggest reasons to use a broker. Different lenders weight overtime, bonuses, commission, self-employed income, and benefits income differently. The difference between the most and least generous lender for your specific income profile can be £20,000-£50,000 in maximum borrowing.
Can I include rental income from a lodger or second property?
Some lenders will consider expected rental income if you're buying a property with a separate annexe or plan to rent a room under the Rent a Room scheme. However, this is uncommon for first-time buyers and typically requires specialist advice.
How far in advance should I get a Decision in Principle?
Get a DIP before you start seriously looking at properties. It's valid for 60-90 days with most lenders, doesn't commit you to anything, and gives you confidence about your budget. For new builds, don't submit the full mortgage application until 3-6 months before expected completion. See our mortgage timeline guide for timing advice.
What if my salary increases after I start looking?
A salary increase improves your borrowing power immediately — you don't need to wait. Get updated payslips showing the new salary and ask your broker to reassess. For recent promotions or job changes, some lenders accept an employment contract showing the new salary even before you've received a payslip at the new rate.