The average LTV ratio on mortgaged homes across the UK has fallen to 59%, down from around 70% in 2012, highlighting the structurally lower leverage of today’s housing market, according to analysis from the Intermediary Mortgage Lenders Association (IMLA).
IMLA’s report reveals that, since the financial crisis, an estimated £677bn of housing equity has built up across the UK housing stock, through a combination of mortgage repayment and rising property values. As of 2024, around 42% of private homes carry a mortgage, meaning most properties are owned outright or with relatively modest levels of debt.
IMLA said lower average LTVs have reduced the sensitivity of many borrowers to interest rate movements and strengthened overall market resilience.
However, the association said this strength among existing homeowners sits alongside substantial barriers to entry. IMLA’s 'Affordability Paradox' report in 2025 revealed that an estimated 3.5 million potential first-time buyers who might historically have been expected to purchase remain outside the market, many of whom will require innovative mortgage products to get on the housing ladder.
Kate Davies, executive director of IMLA, said: “The market has demonstrated resilience, but we cannot ignore the access gap. There is a generation of aspiring homeowners who will need higher loan-to-value options, creative solutions and flexible products to take their first step.
“Those products already exist and innovation is continuing, but standards must remain robust. Higher-LTV lending must sit within disciplined affordability testing to ensure borrowing is sustainable over the long term.
“First-time buyers need clear information about the options available to them and support in navigating an increasingly complex market. Professional advice plays a critical role in ensuring that those entering at higher LTV levels do so responsibly and with confidence.”
