Choice of 5% deposit mortgages 'widest since 2008'

First-time buyers have been given a boost as the choice of low-deposit mortgage deals on the market has reached its widest level in a decade.

There are now 307 deals available for people with only a 5% deposit, the first time since April 2008 the number has passed the 300 mark, according to Moneyfacts.co.uk.

Charlotte Nelson, a finance expert at Moneyfacts, said the comeback in 5% deposit deals, with 37 more of these mortgages appearing in just a month, bucked the trend seen generally for larger-deposit mortgages, which have seen numbers fall in March.

Ms Nelson said: "The numbers for this month were improved by eight lenders re-entering the market.

"Providers know that many borrowers on their mortgage books, who are coming to the end of their mortgage, may want to take advantage of the low rates on offer elsewhere.

"So the introduction of new deals at 95% will give the providers' mortgage book a new zest for life."

Alongside the expansion of 5% deposit deals, Moneyfacts said the average two-year fixed rate for this deposit level had fallen for five months in a row, reaching 4.02% in March.