Vida Homeloans has stated that increasing numbers of first time buyers are taking advantage of greater product innovation in the mortgage market.

The lender believes that a wider range of products and a range of new lenders has meant that first-time buyers, who may have previously had limited choice from mainstream lenders, are now succeeding in getting their foot on the property ladder, often by using gifted deposits or buying with family and friends.

Statistics from Vida Homeloans show that since the company’s launch in October last year, 42% of its residential purchase customers have been first-time buyers. This is in line with CML data showing that the number of first-time buyers over the last 12 months has overtaken the number of home movers for the first time since 2006. The data from the lender also shows it has loaned first-time buyers an average £171,000 per purchaser, over £35,000 more than the average loan amount quoted by the CML.

A third of Vida’s applicants have used gifted deposits from close relatives and two-thirds have been part of a maximum of 4 borrowers getting together to buy a property. Over a third are self-employed and acceptable types of property such as flats above commercial premises are also an important consideration. Not all first-time buyers are maximising their LTV, with the majority borrowing below the 85% maximum.

Louisa Sedgwick, director of sales, mortgages, at Vida Homeloans, said: “The data we have gathered since last October shows that first-time buyers are taking advantage of the wide range of products and specialist options in the market currently, despite the near constant commentary suggesting buying your first home is becoming out of reach for some would-be first-time buyers. We have been amazed by the numbers of first-time buyers we have lent to already and we’re really proud to help them become homeowners.

“Whilst this is encouraging news for those buyers who are able to get onto the ladder, more needs to be done to promote the affordability of home ownership to those who have so far felt unable to purchase their first property. Brokers play a crucial role in ensuring first-time buyers pursue home ownership and don’t get deterred at the first step, which can often be a knock-back from high-street banks. Brokers need to be considering the wide range of products or features on offer, allowing these budding home owners to become real first-time buyers. As the mortgage lending market continues to evolve with greater product innovation, borrowers need to be aware they can take advantage of the various choices available to them and should be optimistic about purchasing their first house.”