Following on from the downturn in economic fortunes which started around 2008, things haven't been great for first time buyers. After being spoiled for so long with one hundred per cent mortgages and higher in some cases, we were brought back down to earth with a bang as lenders started to become a hell of a lot more cautious in order to prevent themselves from being exposed to even more toxic debt.
There can be no doubts that the culture of one hundred per cent mortgages needed to end - it's not right and never has been for someone to be able to walk into a bank and easily get a loan for a house with absolutely no savings at all with which to offer a deposit - but the speed and severity of the change surprised many.
We went from being able to take mortgages with a one hundred per cent loan to value (LTV) rating, to barely being able to find a mortgage despite having upwards of twenty five per cent of the value of the property ready for a deposit.
Things started to improve in 2010, as the banks finally decided it was time to start loosening their belts in order to bring in some new customers and kick start the housing market again. The best deals available to borrowers still required deposits of twenty five to forty five per cent deposits, but at least they were open to negotiations, and at least offered the occasional ten to twenty per cent mortgage to customers.
Today things have improved even more. We now have the UK government offering to pay up to five per cent of the mortgage for first time buyers who earn less than £60,000, while rates for mortgages with a fifteen to twenty five per cent LTV are much more affordable than they were just six months ago, with a number of new incentives and schemes being unveiled in a bid to inspire consumer confidence in the housing market once again. We aren't there yet, but things are improving, and mortgage deposits are lower than 2010 at last!