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While higher loan-to-value (LTV) mortgages dominate first-time buyer demand a significant minority are seeking higher deposit deals, fresh data from Moneyfacts can reveal.
Among first-time buyers searching for fixed-rate mortgages on the comparison site, 30% are opting for 90% LTV products, with a further 12% looking at 95% LTV deals, indicating that many buyers are relying on deposits of between 5% and 10%. Based on the average UK house price of £271,188, this equates to deposits of between £13,560 and £27,120.
At the same time, 31% of first-time buyers are searching for mortgages with loan-to-value ratios below 75%, suggesting a notable proportion are entering the market with deposits of at least 25%. On an average-priced home, this would require a deposit of around £67,800.
The data also shows a clear cost gap between buyers with smaller and larger deposits, with those borrowing at higher LTVs potentially paying around £174 more per month than borrowers with greater equity borrowing the same amount.
Among home movers, equity levels remain an important factor, with 69% waiting until they have at least 25% equity before moving, while a further 16% look to progress with around 15% equity.
Consumer demand for fixed rate mortgages by LTV Max Loan-to-Value (LTV) First-time buyers Second-time buyers Remortgage Moneyfacts Average Mortgage Rate (2-year fix) Monthly mortgage repayment* 60% 17% 47% 68% 4.21% £1,349 75% 14% 22% 19% 4.74% £1,424 85% 23% 16% 10% 4.83% £1,437 90% 30% 11% 2% 5.10% £1,476 95% 12% 3% 1% 5.42% £1,523Consumers comparing fixed term mortgage deals on moneyfactscompare.co.uk, 1-30 January 2026, by borrower type and LTV. Average mortgage rates correct as at 30 January 2026.
*Assumed £250,000 borrowed over 25 years. Capital and interest repayment.
Source: Moneyfacts Analyser
Adam French, head of consumer finance at Moneyfacts, said: “The widespread of first-time buyer LTV demand reflects a housing market increasingly shaped by unequal starting points. While many first-time buyers are stretching themselves with 90–95% LTV mortgages due to deposit constraints, a notable minority are entering the market with substantial deposits, often helped by family support or inheritance.
“The concern is that it is creating a two-tier market where buyers with higher deposits can access cheaper rates and lower monthly repayments, while others pay a hefty premium. For second-time buyers and remortgage customers, the data shows equity remains king, with most waiting to build at least 25% equity. Although wise buyers should note that materially cheaper average rates kick in at around 15% equity.”
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