UK sees record high share of low‑deposit mortgages since 2008

The proportion of UK home loans secured with deposits of 10 percent or less has risen to its highest level since the financial crisis of 2008, according to recent data from the Bank of England. The increase reflects a broader shift in the housing market, where rising property prices and tighter savings rates have pushed more buyers to rely on smaller upfront contributions. Lenders have responded by tightening affordability assessments and, in many cases, attaching higher interest rates to low‑deposit mortgages to offset the greater credit risk.

In a series of interviews, the BBC spoke with borrowers who have secured mortgages with modest deposits to understand how they are managing the associated risks. Respondents reported a mix of strategies, including budgeting for larger monthly repayments, maintaining emergency savings, and opting for fixed‑rate products to protect against interest‑rate fluctuations. Some also highlighted the use of government‑backed schemes such as Help to Buy, which provide partial guarantees to lenders. Analysts note that while the trend expands home‑ownership opportunities for cash‑constrained buyers, it also raises concerns about potential stress on households should property values or income levels decline.