The latest Mortgage Monitor from e.surv found that first-time buyers and others with small deposits took a greater share of the market than last month, with overall approval levels also up compared to August.
The UK’s largest residential chartered surveyors found that there were 66,704 mortgages approved during the month of September (seasonally adjusted).
The report said the market continued to be affected by both the final days of warm weather, and the continued impact of the Bank of England’s base rate rise.
With the base rate having increased on 2nd August –September was the first month many homeowners would have received their new, higher mortgage bills if they are on a standard variable rate (SVR).
First-time buyers were not affected by such matters, and there was a strong increase in the proportion of the market occupied by these borrowers.
Young buyers may have been helped onto the ladder by the fact house price growth has slowed across many areas of the country, the report said.
E.surv said lower prices mean that would-be buyers can achieve their dream of home ownership much sooner, and this appears to have been borne out by these figures.
Richard Sexton (pictured), director at e.surv, said: “There has been a shift in the market towards young borrowers in September, it will be interesting to see whether this carries on into October and the rest of the year.
“But with existing homeowners trapped on expensive standard variable rates (SVRs) now feeling the cost of higher mortgage rates, the remortgage market cannot be underestimated.
“Remortgage activity was up compared to last month, and September 2017.
“Despite the rate rise, new mortgage borrowing is still very competitive and homeowners will continue to be tempted by cheap fixed rates. This will protect them against future base rate rises.”
When broken down on a regional basis, every single part of the UK saw a smaller proportion of loans given to large deposit borrowers than a month ago.
London continued to be the market most dominated by these borrowers, with 40.5% of all loans going to this segment of the market. Close behind was the South East on 37% and then the South and South Wales on 32.7%.
In contrast, just a fifth of borrowers (20.3%) in Yorkshire had a large deposit.
This was ahead of the North West and the Midlands, which both scored 24% in the month.
Four regions – Northern Ireland, the North West, the Midlands and Yorkshire – saw a greater number of loans go to small deposit borrowers than their large deposit counterparts.
In Yorkshire, more than a third (33.5%) of loans were to first-time buyers and others with small deposits.
Elsewhere, in the North West 30.4% of all loans went to this part of the market while in Northern Ireland this ratio was 28.9%.
The final region to have more small deposit borrowers than those with large deposits was the Midlands, with 28% of loans going to the former category.
London once again was the market with the fewest small deposit buyers. Just 13.8% of all loans went to this part of the market during September. This was ahead of the South East (19.4%).
