Newcastle Building Society: Deposit Unlock market update

Newcastle Building Society has issued an update on the success of the Deposit Unlock since it pioneered the scheme last year.

The initiative supports first-time buyers and low-deposit borrowers in getting a foot onto the property ladder, and is set to fill the gap left by Help to Buy as this ends.

  • The government’s Help to Buy scheme is set to end in March 2023 after 10 years of helping young people and families on to the property ladder.
  • For first-time buyers looking to use the scheme, the deadline is even sooner – they have until 31st October to reserve a property and apply.
  • Recent research from Savills highlights how Deposit Unlock will help to fill the gap left by Help to Buy, forecasting 24,451 Deposit Unlock completions in the 3 years to 2026.
Deposit Unlock market update:

As house price growth continues, it’s increasingly difficult for first-time buyers and low-deposit borrowers to save the deposit they need. That’s one of the reasons why last year, Newcastle Building Society developed and launched the innovative mortgage indemnity scheme Deposit Unlock in partnership with the Home Builders Federation and insurance brokers Gallagher Re.

  • 75% of applications under Deposit Unlock to Newcastle Building Society have been from first-time buyers
  • The average property sale price through Deposit Unlock is £288k, higher than the Help to Buy cap in many of the regions
  • The average deposit provided by Deposit Unlock customers is £15k
  • Since launch, the number of participating developers has grown to 21, with eligible sites now located nationally and consistent interest in the scheme from customers and brokers.
Stuart Miller, chief customer officer at Newcastle Building Society, said:

“Any rise in house prices makes it increasingly difficult for first-time buyers and low-deposit borrowers. Whilst the rate of house price inflation appears to have slowed, the cost of living squeeze and wider economic uncertainty means it’s now harder than ever to save for a deposit.

“Help to Buy has assisted thousands of prospective homeowners over the past 10 years but as it comes to an end, we need to fill the gap that it leaves behind. That’s why innovative schemes like Deposit Unlock are so important. Firstly, Deposit Unlock is industry-led, and not reliant on government support or taxpayer funding, and secondly it’s straightforward from a homebuyer perspective – a 95% lending option on a new build home.

“It’s rewarding to know that since we helped launch Deposit Unlock nationally last year, we’ve already helped so many people achieve their dream of home ownership, and that initiatives like Deposit Unlock will become even more critical for homebuyers in a challenging market.”


Kindly shared by Newcastle Building Society

Main article photo courtesy of Pixabay