Low deposit mortgage lending up 38% in the past year, data finds
The value of new mortgages with deposits below 10% rose to £24.7bn in the year to 30th June 2026, analysis from TWM Solicitors found.
The value of new mortgages with deposits below 10% rose by 38% to £24.7bn in the year to 30th June 2026, analysis from TWM Solicitors found.
This was up from £17.9bn in the previous year.
New mortgages with deposits below 5% more than doubled from £720m to £1.5bn, an increase of 100.4%.
TWM Solicitors stated that rising living costs made it harder for younger buyers to save a deposit.
Julian Sampson, partner and head of lending at TWM Solicitors, said: “After several years in which higher interest rates and rising living costs made it increasingly difficult for first-time buyers to save a meaningful deposit, we’re now seeing lenders respond with a much broader range of low-deposit products.
“The regulator has encouraged lenders to widen access to mortgages, and banks have responded by creating more innovative mortgage products.
“Many buyers who previously found themselves excluded from the market now have more routes into home ownership than they would have had just a few years ago.”
Sampson added: “What is rewarding are the number of conversations we are having with lenders’ product teams who are taking active decisions to structure their mortgage products with this one aim in mind.
“The consumer lending market is bubbling with intent.
“There is substantial deferred demand for mortgages amongst young people – low deposit mortgages are opening up home ownership to many of those buyers.”
Data also showed that low-deposit mortgages accounted for 8.4% of new UK mortgages, compared with 15% in the quarter to 30th June 2007.
Sampson said: “Although low-deposit mortgages can make home ownership possible much sooner, buyers should remember that borrowing a higher proportion of the property’s value usually comes with higher interest rates.
“That means monthly repayments may be higher and it can take longer to build equity, increasing the risk of negative equity if house prices fall.”
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