New data suggests that mortgage approvals for homebuyers with small deposits rose significantly towards the end of last year, as first-time buyers moved to secure their place on the property ladder following an historic Stamp Duty Land Tax (SDLT) cut.
According to data from chartered surveyors e.surv, 17.2 per cent of all approved loans granted in November 2017 went to buyers with small deposits.
In December, this percentage rose to 21 per cent – with as many as 13,961 mortgages approved for small deposit buyers.
Elsewhere, research has found that the average monthly rate of a 95 per cent loan to value (LTV) mortgage – available to those with a deposit of just five per cent – fell by 0.05 per cent in January.
Meanwhile, the average cost of a 90 per cent LTV deal fell by 0.03 per cent, figures from Moneyfacts UK reveal, suggesting that small deposit loans are becoming more affordable.
The news comes shortly after Chancellor Philip Hammond abolished SDLT for first-time buyers on purchases up to £300,000.
Following the changes, first-time buyers purchasing homes valued up to £500,000 also no longer need to pay SDLT on the first £300,000 of the property’s value.
On top of these savings, research from Halifax estimates that the average UK adult moving from renting a property to being a new homeowner is likely to save approximately £27,000 over a 30-year team.