Banks have withdrawn 60 per cent of mortgages for borrowers with small deposits since the start of the year, making it harder for first-time buyers to get a foot on the property ladder.

A number of lenders have either pulled home loans or have yet to return with their 95 per cent loan-to-value products following former chancellor Kwasi Kwarteng’s “mini” Budget on September 23, according to data from consumer site Moneyfacts.

The sell-off in UK government bonds in the wake of the chancellor’s statement pushed up the cost of fixed-rate mortgages, with most banks withdrawing products for new customers across a range of deposit sizes. Home loans requiring small deposits have been hit the hardest, as lenders have sought to retreat from the riskiest part of the market.