No-deposit mortgage sales hit their highest level in five years last year, giving landlords another sign that some renters may find it easier to move into homeownership if lenders keep reopening higher-risk parts of the market.
Data reported by Mortgage Solutions from Financial Conduct Authority data obtained by Compare the Market showed 574 sales of 100% loan-to-value mortgages in the first three quarters of 2025. That was already above the 452 completed in the whole of 2021 and well ahead of the 423 recorded in 2024.
No-deposit mortgage sales rise as lenders test demand
The figures show how quickly this corner of the market has revived. Sales fell to 135 in 2022, then recovered to 248 in 2023 before climbing again in 2024 and the first nine months of 2025.
The strongest regional volumes were in the North West and South West, each with 76 sales, followed by East Midlands and Yorkshire and the Humber on 67. Scotland recorded 64.
Charlie Evans, money expert at Compare the Market, said the rise reflected how hard it has become for many buyers to save for a deposit while rents and household bills absorb disposable income.
For landlords, that does not mean a rush of tenants leaving tomorrow. The numbers remain small in the context of the wider mortgage market. But they do point to a slow change in direction at a time when parts of the rental sector have been relying on would-be first-time buyers staying put for longer.
This follows Residential Landlord’s recent coverage of a softer house price backdrop, which noted that affordability is improving unevenly across the country. If more lenders are willing to support higher loan-to-value borrowing, that could widen the exit route from renting in selected regional markets.
Why landlords should watch affordability, not just headline demand
There is still a catch. Compare the Market said 100% mortgages remain more expensive than 95% loan-to-value products. Using an average house price of £270,000 over 30 years, it estimated monthly repayments at £1,542 on a no-deposit deal, compared with £1,421 on a 95% loan with a 5% deposit.
That is a meaningful gap. It means landlords should be wary of assuming a surge in first-time buyer competition will suddenly cool rental demand. Higher borrowing costs still limit who can use these deals, even where lenders are prepared to offer them.
Residential Landlord has also reported that millions of borrowers remain exposed to higher mortgage payments, so affordability remains fragile. The practical takeaway for investors is to watch local conditions closely. Markets with lower entry prices and stronger wage growth are more likely to feel any impact first.
For landlords weighing disposals, this matters. A modest return of no-deposit lending could support buyer demand at the lower end of the market. For investors trying to expand, it is another reminder that the tenant pool and buyer pool are starting to overlap again in some regions.
Opinion
No-deposit lending is not back at scale, but it is moving in one direction. Landlords should not panic about a mass tenant exodus, yet nor should they assume renters will stay trapped forever if lenders keep chipping away at the deposit barrier.
