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More buyers with smaller deposits able to buy

Applicants with smaller deposits are increasingly securing mortgages as lenders offer more high-LTV loans, new research suggests.

Nearly half of all homebuyers had a deposit of less than 20% over the last year, according to research from the Nottingham Building Society.

And 27% of successful buyers completed deals despite having deposits of less than 10% of their house price.


The average homebuyer over the past year had a deposit of 29%.

The research also shows that more than 50% of 25-34 year-olds used brokers to source their mortgage.

That figure drops to 33% of those aged 55-64 but overall more borrowers are now using brokers.

The Nottingham said there are currently 605 mortgages available at 90% or 95% LTV, up from 325 in 2011.

Ian Gibbons, senior mortgage broking manager at Nottingham Mortgage Services, said: “Homebuyers are demonstrating their commitment for a deposit as highlighted by the average 29% they are able to put down.

“Many will be using the equity they have built up in their home but it is also clear that people saving for deposits are succeeding in the market as well with nearly half of those putting down 20% or less.”

The study also found that cash buyers remain a force in the market. Around 12% who have bought in the past year or plan to buy in the next two years say they did not need to borrow.


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