First-time buyers more concerned with actually getting hold of a mortgage deal

First-time buyers are simply concentrating on securing a mortgage deal, rather than looking for one with the very lowest rate, according to an expert.

Paula John, editor-in-chief at Your Mortgage, said that investors in UK property need to think about access to the market, helping them to get on to the property market in the first place.

"You will need at least five per cent and some of them will demand bigger deposits than that. They will all demand squeaky clean credit records and then there will be other criteria in place as well," she added.

"It is very hard to access finance if you are a first-time buyer because, in general, the lending community hasn't got a massive appetite to be lending to first-time buyers who are inherently a higher risk than other types of borrowers because they haven't borrowed before."

Ms John went on to say that there are exceptions to this rule, and Lloyds Banking Group has a Lend a Hand scheme which involves parents guaranteeing some of the deposit payment.

Nationwide has introduced other initiatives where first-time buyers who have saved with them for at least six months, and who have tucked away a certain amount of money, are more likely to get one of their mortgages.

"Some of the bigger banks who are not necessarily quite as interested in lending to first-time buyers – the Royal Bank of Scotland and maybe Santander – just don't have the appetite for it," Ms John said.

Her comments came after the Building Societies Association revealed that mortgage approvals by mutuals were up by 67 per cent in May compared with the same point last year, as first-time buyers considered their finance options away from the larger high street institutions.

Furthermore, this was 32 per cent higher than over the previous six months, with a quarter of these deals being agreed with those investing in properties for sale for the first time.