Choice of low-deposit mortgage deals on market highest since 2008

The number of low-deposit mortgage deals on the market has reached the highest since the 2008 financial crisis, new data shows.

Lenders have been under pressure to help more aspiring homeowners as affordability remains squeezed.

There were 442 mortgage deals available for buyers who can put down a 5% deposit on a home, according to financial information website Moneyfacts, which looked at data for the first available day of the month.

For buyers with a 10% deposit, it counted 845 deals on the market.

It means that both were at the highest point since March 2008, when economies around the world were plunged into recession and banks were forced to tighten their lending rules.

But lenders have been rolling out more low-deposit mortgage deals in a bid to stimulate activity in the housing market and appeal to people who are less able to raise a large deposit on a home.

Earlier this month, Barclays said it was offering zero-deposit mortgages for right to buy (RTB) customers – which enables tenants to buy their council home at a discount.

In the past, Barclays has required a 5% deposit, but it confirmed it will no longer be requiring a deposit for its RTB deals, which are available in England.

Rachel Springall, a finance expert for the website, said: “The flourishing choice of low deposit mortgages will no doubt be welcomed by borrowers who are either looking to remortgage or are a first-time buyer.

“The Government has been clear that it wants lenders to do more to boost UK growth, and so a rise in product availability for aspiring homeowners is a healthy step in the right direction.”

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But she said there was still “much more room for improvement” with the number of 5% mortgages on offer representing 6% of all fixed and variable mortgage deals available to borrowers.

Meanwhile, the average “revert to” or standard variable rate (SVR) mortgage was 7.6% at the start of April – making the need to find a new, less costly deal more pressing for some borrowers.