According to the latest mortgage monitor from e.surv 65,997 residential mortgages were approved during September, up by 0.7 per cent from August, and 0.6 per cent on the same month last year.
The firm said competition among lenders looking to meet their annual targets was driving down prices, which had “tempted borrowers of all kinds into the market”.
It noted that the proportion of loans to borrowers with small deposits had risen slightly from 28.3 per cent to 28.7 per cent in the month, while the low rates on offer had tempted those with large deposits to remortgage, with the size of this sector increasing to 27.9 per cent from 26.6 per cent.
Richard Sexton (pictured), director of E.surv, said low mortgage rates have had the twin benefits of helping borrowers “at both ends of the deposit-size spectrum”.
He added: “Both small and large deposit borrowers will be glad to see these cheap deals continue for the rest of the year.”
Large deposits dominate
On a regional basis, E.surv suggested that the softening of the London market has boosted the chances of first-time buyers, with almost one in five (19.7 per cent) of mortgage approvals in the capital going to those with smaller deposits, compared to 19.4 per cent in August and 17.7 per cent in July.
Despite this, it noted that London is still dominated by large deposit borrowers, with more than a third (35.4 per cent) of all lending going to those with a deposit of 40 per cent or more, the largest proportion of anywhere in the country.
There were only three regions where the number of small deposit borrowers outnumbered large deposit counterparts: Yorkshire, the North West and the Midlands. Yorkshire boasted the largest proportion of small deposit borrowers at 35.5 per cent.