October’s figures show a 3.5pc rise in average deposits

The average deposit rose to £71,301 in October, with an increase seen in nine out of ten regions across Great Britain.

According to the Mortgage Advice Bureau, deposits were on average 0.9% higher than they were in September and 3.5% higher than they were a year ago.

East Anglia saw the largest increase, where typical deposits rose 11.6% month-on-month from £46,504 to £51,877.

Borrowers also are fronting more of their own money as house prices rise, the research reveals.

The typical loan size in East Anglia dropped from £132,325 in September to £125,039 in October.

The largest deposits were seen in London, with an increase of 5.2% recorded, making the average deposit £179,248.

The dedicated London Help-to-Buy scheme is predicted to give a boost to first time buyers in the capital who, based on a 5% deposit of their own, will be offered a loan of up to 40% of the value of a new build property, interest free for five years.

Given that the average house price in London was £533,922 in October, borrowers in the capital would therefore pay a deposit of £26,696.

Brian Murphy, Head of Lending at the Mortgage Advice Bureau, said:

“George Osborne’s Autumn Statement hammered home the government’s support for homeownership, with several policies aiming to improve both the supply and affordability of homes.

“This is sorely needed in the capital, where house prices remain much higher than in the rest of the country and saving up for a deposit can seem an impossible task. However, with average deposits rising across the UK, support is needed nationwide.”

Data extracted from Mortgages for Businesses’ Complex Buy to Let Index Q3 2015 shows that the trend in rising deposits is also true within the buy to let sector.

All property types, with the exception of Houses in Multiple Occupation (HMO), saw significant increases in average deposit amounts from Q1 to Q3 this year.

The average deposit for Vanilla Buy to Let properties jumped from £110,803 in Q1 to £117,992 in Q3, an increase of 6.5%, whereas the average deposit for Multi-Unit Freehold Blocks rose from £174,046 in Q1 to £204,871 in Q3, seeing an increase of 17%.

Total purchase mortgage applications made through brokers rose 28.7% year-on-year in October, resulting in the largest number of applications since the Mortgage Advice Bureau Index started tracking this in early 2009.