More than 800 people have been helped on to the property ladder in the year since a £5,000 deposit mortgage deal was launched, according to a building society.
When it launched the deal at the end of March 2024, Yorkshire Building Society said it would enable first-time buyers across England, Scotland or Wales with a £5,000 deposit to purchase a property valued at up to £500,000.
For someone buying a typical first-time buyer property at £200,000, a £5,000 deposit would equate to 2.5% of the purchase price, with the remaining 97.5% being borrowed as a mortgage, the society said last year.
Speaking as the deal passed its first birthday, Ben Merritt, director of mortgages at Yorkshire Building Society, said: “Launching this product and seeing the effect it has had has been so humbling and has really brought home to us the fact what we do is not just about bricks and mortar.”
The society said some people have cried with happiness on the phone when they were told a decision-in-principle had been agreed.
It said customers have also told it the product has not only enabled them to get on the housing ladder faster but also to make other life plans such as getting married and starting a family.
It quoted customers Leona McKay, 25, and Mark Pennie, 26, who moved into a three-bedroom family home in Aberdeen in April last year, from a flat.
Ms McKay, a social worker, said: “We always said we wouldn’t have kids in the flat because carrying a buggy up three flights of stairs, with two dogs and a bag of shopping, was no good. Now we can actually start to imagine our future, plan to get married and think ‘This is where our kids will go to school’ and ‘This is where they’ll play in the park’.”
The society also recently launched a new product range at the end of March, offering up to £6,250 cashback to help buyers with the increased costs they face following the changes to stamp duty thresholds from April 1.
Meanwhile, a survey commissioned by West Brom Building Society among more than 2,000 private renters across the UK found more than half (52%) believe that high house prices are their biggest barrier to owning a home.
Two-fifths said rising living costs are making it hard to save for a deposit while a quarter cited high mortgages rates as a factor.
Nearly half (48%) had at some point tried to save for a home deposit, but this figure dropped to 28% when people were asked if they were currently saving for a deposit.
About a third (34%) said competing financial goals, such as paying off debts or saving for a wedding, had taken priority, according to the YouGov research carried out in February.
