The National Mortgage Index from adviser firm Mortgage Advice Bureau, showed the average house purchase deposit fell by 2% between February and March. It tumbled to £61,325, which is the lowest figure for a year.
In March, average buyer prices rose 7% year-on-year, but the return of high LTV mortgages has helped ensure average deposits have grown at less than half of this rate at 3%.
The data suggests applications growth this year have slowed a little to 4%, against a 28% rise between January and February and 19% between February and March last year.
Year-on-year figures suggest the market is cooling slightly ahead of changes to the incoming Mortgage Market Review later this month (MMR), said MAB.
Mortgage product numbers rose to 11,126, which is the highest point this year so far, advantaging the broker channel over direct. Broker deals rose by 3.7% from February to 7,569. In contrast, direct-only products fell by 2.4% to 3,557.
Brian Murphy, head of lending at Mortgage Advice Bureau, (pictured) said: “The option to take out a high LTV mortgage has been relied on by generations of first time buyers to get on the housing ladder. In a climate of strengthening house prices, buyers can take heart that deposit requirements are visibly easing thanks to the return of high LTV loans.”
He added: “Lenders are gradually phasing in the changes required by the MMR and are clearly putting an emphasis on brokers when it comes to product distribution. The importance of understanding consumers’ finances and lenders’ requirements will make seeing your broker an even more important step to getting a mortgage under the new regime.”