Lending to FTBs with small deposits sees fall across UK

Lending to FTBs with small deposits sees fall across UK

The number of first-time buyers in the UK able to get themselves a mortgage with a small deposit saved has seen a fall across the country in the past month, according to the latest data examining the market in the post-Autumn Statement period. 

The latest Mortgage Monitor from chartered surveyors e.surv showed that since the Autumn Statement from the chancellor, there was a jump in house purchases amounting to 1.3 per cent, meaning there were as many as 70,511 purchases in November alone. 

However, while the number of homes being bought and sold climbed since the end of the autumn period, first-time buyers are still waiting to see any benefit from changes made by the chancellor, with the number of loans afforded to those getting on the ladder for the first time and who only have a small deposit saved, falling. 

Despite the rise in the number of people who have been able to buy a home, lending to small deposit borrowers, people who have a deposit that is 15 per cent or less of the value of the home they are buying, has seen a real drop. 

Only 11,493 were afforded in November, which was only four more than the 11,489 that was afforded in October. However, with sales numbers on the whole rising, this represented just 16.3 per cent of all mortgages in November, down from the 16.5 per cent that was recorded in October. 

It was a similar story from the First Time Buyer Tracker report from Your Move and Reeds Rains, which stated that the number of purchases made by first time buyers dropped by 1.7 per cent between October and November. 

"Some small deposit borrowers are still struggling and with house prices predicted to keep on rising there’s a real risk many may be permanently priced out of home ownership. In order to stop this, more needs to be done to remove obstacles facing home buyers, particularly large deposit costs," said Richard Sexton, director of e.surv.