Rise in number of loans to small deposit borrowers

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There were 66,350 mortgages approved in January 2019, according to seasonally adjusted figures from E.surv.

The firm’s latest Mortgage Monitor said the number of mortgages approved in January is often lower than in a typical month, as December is traditionally a slow month for house hunting. However, there was strong growth compared to the previous month, with approvals rising 4% between December and January.

And yet, compared to January 2018, approvals were down 1.8%.

Despite mixed predictions for the housing market this year, the residential chartered surveyors said there were encouraging signs for younger borrowers with little cash to spare.

In January, some 27.1% of all mortgage approvals were to borrowers with a small deposit. This represents a strong improvement on December’s market position, when the number of approvals to these borrowers was 25.2%.

Richard Sexton (pictured), director at E.surv, said: “There are many predictions for the housing and mortgage markets in 2019, ranging from the bullish to the more cautious.

“But the data for January shows that the market has started the year in reasonable health, with approvals rising compared to December 2018.

“Hard-pressed first-time buyers will be pleased to see a swing towards borrowers with small deposits this month. If this pattern continues across the year, it will be a welcome relief to those struggling to get a foot onto the housing ladder.”

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