According to recent data, low-deposit mortgages are as widely accessible as they’ve ever been. It’s the biggest increase of these products since the 2008 financial crisis. According to Moneyfacts this means that buyers are down to just 442 mortgages available to them. These kind of choices need a 5% down payment. This dramatic increase in choices benefits the entry-level buyer the most. Now many of them say they’re struggling to save for bigger deposits because house prices have gone up.
Great news—the mortgage market is thriving for future homeowners! The share of deals needing a 5% or 10% downpayment has spiked to highs not seen in more than 15 years. Those borrowers able to offer a 10% deposit now have access to a whopping 845 products. This is a huge leap from only 684 choices as of April 2023. Rachel Springall from Moneyfacts remarked, “A rise in product availability for aspiring homeowners is a healthy step in the right direction.”
Our prevailing, high-flying housing market has homes flying off the shelf almost before you can see them. Two-bed homes have proven the most desirable, with sales agreed in an average of just 23 days. In opposition, bigger houses with four or more bedrooms usually spend 15 more days on the market. According to Zoopla, a leading UK property website, 50% of homes were selling within an average of two months. All of this combined makes it crucial for buyers to move fast now more than ever.
Average English and Welsh homes take 36 days to find a buyer. That’s their region’s current average time on market for home sales. The second- and third-fastest-selling areas are Manchester and the London borough of Waltham Forest. Properties in these areas are going under contract in an average of only 19 days! This level of turnover, while exceptional, illustrates just how quickly today’s property market can change.
While these are all positive trends, obstacles still stand in the way for many buyers. Mortgage rates remain volatile, driven by uncertainty over US tariff policies and their potential impact on the overall economy. Buyers are facing sticker shock, often $100,000 more than they were paying just a year or two ago. They benefit from access to a broader set of mortgage goods.
Richard Donnell, executive director at Zoopla, said it has become a very different place for buyers. “Buyers have a lot more choice of homes for sale than a year ago,” he stated. He added a cautionary note regarding pricing strategies: “Aiming too high on the asking price is likely to impact saleability and how long you may have to wait to agree a sale.”
Their increase among available mortgage options is a hopeful sign for many. As it stands, only 6% of all live mortgage products, fixed and trackers combined, ask for a deposit of 5%. Unfortunately, this statistic indicates that despite the growth of these opportunities, they are still just a drop in the bucket compared to the total market.