Patrick Collinson 'The Guardian'

Five years ago there were more than 800 different 95% mortgages available to first-time buyers. When the financial crisis struck, they disappeared from lenders' shelves almost overnight. But the first few weeks of 2012 are seeing a surprise turnaround – the number of loans on offer has tripled and interest rates have fallen. Will "generation rent", until now forced into renting because they can't stump up the huge deposits demanded by lenders, finally be able to put a foot on the property ladder?

This week Leeds building society launched a mortgage that requires a deposit of only 5% and comes with an interest rate of 5.25% (although there's also a hefty £999 in fees). Last week both Newcastle and Ipswich building societies launched 95% deals, while broker John Charcol says it will unveil a low-deposit scheme for first-time buyers in early February.

It follows the launch of Nationwide's Save to Buy scheme, in which savers who put money aside for at least six months can apply for a 95% loan, and Lloyds' Lend a Hand scheme, where first-time buyers can access a 95% deal if they can convince their parents to put their savings up as security against the mortgage.

Buyers able to stump up a larger 10% deposit can enjoy interest rates as low as 3.84% from HSBC – which brings the cost of a mortgage significantly below the average that buyers were able to find during the boom. Full Article Continued ...

First-time buyers are back in the frame as several building societies begin to offer 95% mortgages. Photograph: Matt Cardy/Getty Images.