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House deposits rise 43% in a year

The average deposit needed top secure a property has risen 43 per cent to nearly £40,000.

According to mform.co.uk, homebuyers now need a deposit of £37,119 to qualify for the most competitive mortgage deals. The average deposit necessary has soared by 43 per cent from last year when it was £20, 980.

The research discovered that buyers in London require a massive £71,616 to be sure of a property.

A year ago best-buy mortgages required an average deposit equal to 11.75 per cent of the properties value, according to mform.co.uk, but the average now is 20.75 per cent. Two-year fixed rate deals have seen the biggest jump from just 10 per cent last August to 23 per cent today.

Mform.co.uk marketing and business development director Francis Ghiloni says: “Availability of mortgage deals remains the biggest issue for borrowers who do not have equity in their homes. Those who have benefited from the decade-long housing boom can still qualify for the most competitive rates.

“However first-time buyers or those who have entered the property market recently will struggle to qualify for the most competitive rates. That makes it even more important for borrowers to focus on the true cost of their loan including all fees and not to simply focus on rates. There are still competitive deals and lenders willing to offer 95 per cent loans but the most competitive offers are being restricted to people with big deposits or substantial equity.”

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