Full details of how first time buyers can qualify for the new 100 per cent mortgage deal

Charlotte Harrison, the lender’s CEO of Home Financing, says: “With only very limited options to borrow with less than five per cent deposit or no deposit at all or without help from friends and family, Track Record mortgages could be the solution many first-time buyers have been searching for.”

To be eligible, borrowers must be a first-time buyer, be 21 or older at the time of application and they must have proof of having paid at least 12 months’ consecutive rent within the last 18 months.

They should also have a year’s experience of paying all household bills, including utility bills and council tax, and if they use a deposit, it must be less than five per cent of the purchase price.

Borrowers should have no payments on debts or credit commitments over the last six months before applying for the mortgage.

Andrew Milnes, Yorkshire Post columnist and mortgage principal at the Mortgage Bureau Bingley, says: “I see this a real positive step from Skipton Building Society and whilst it’s not for everyone, one of the regular conversations we have with clients is around them struggling to save for a deposit given the high cost of renting.

“This mortgage addresses that, as long as the client meets certain criteria, so this deal has to be applauded. Hopefully, this is just the start of further innovation to help those finding it hard to buy in the current marketplace.”

Research by Octane Capital has shown what a 100 per cent mortgage would cost. Based on the average UK first-time buyer house price of £238,742, the average first-time buyer securing a traditional mortgage with a deposit of 15 per cent is placing £35,811 upfront.

This means they require a loan of £202,931 and at the current average rate of 4.22 per cent, this equates to a monthly repayment of £1,096.

Those opting for Skipton Building Society’s 100 per cent mortgage at a rate of 5.49 per cent would have a monthly repayment of £1,465. This means that their monthly repayment would be £369 more per month for a 100 per cent mortgage, compared to those who have placed a 15 per cent deposit.

That adds up to an additional £4,425 over the space of a year but while the sums spell out why saving for a deposit on a home is the most sensible option, the rocketing cost of properties to let has shown that saving is impossible for those in rental accommodation.

Beth Day, 26, who rents and works in Leeds, says: “My partner and I pay £1,200 in rent each month plus bills so saving enough for a deposit on a house is really difficult.

“Even if the interest rates are higher for a 100 per cent mortgage, it would still make sense for us financially and it’s something we are going to look into.”

Also good news for first-time buyers, though not for homeowners, is that house prices slipped last month, according to the latest Halifax house price index.

The average house price fell by 0.3 per cent in April following a 0.8 per cent rise in March and the annual rate of house price growth slowed to 0.1 per cent.

The south of England is under the greatest pressure with the South East seeing a 0.6 per cent year-on-year decline while northern regions fared better.

House price growth in Yorkshire is 2.6 per cent year-on-year bringing the average house price to £203,860. The neighbouring North East registered a three per cent annual growth and the average house price there is £168,941 while the North West saw a 2.7 per cent rise taking its average home value to £223,678.

The Halifax data shows that while existing property prices have fallen by 0.6 per cent over the last year, new-build house prices rose 3.5 per cent over the same period.

Kim Kinnaird, director, Halifax Mortgages, says: “The economy has proven to be resilient, with a robust labour market and consumer price inflation predicted to decelerate sharply in the coming months.

“Mortgage rates are now stabilising, and though they remain well above the average of recent years, this gives important certainty to would-be buyers.

“However, cost of living concerns remain real for many households, which will likely continue to weigh on sentiment and activity. Combined with higher interest rates gradually feeding through to those re-mortgaging their fixed-rate deals, we should expect some further downward pressure on house prices over the course of this year.”