In April 2025, Barclays launched a zero deposit mortgage targeted at council tenants through the Right to Buy scheme. While the aim is to widen access to homeownership, it raises questions about the potential for overheating in the property market—a topic that inevitably draws comparisons to the 2008 financial crisis.
Property Trends and Market Cycles
Over the past year, several lenders have released innovative mortgage products designed to make buying a home more accessible. Skipton Building Society’s no-deposit offer for long-term renters and Barclays’ Right to Buy mortgage reflect a growing willingness to ease traditional barriers like deposits.
These developments are occurring at a time when house prices remain high and supply is constrained. Naturally, when access to credit becomes easier and demand increases without a matching rise in housing stock, market imbalances can emerge. The question, however, is whether these conditions are truly comparable to those leading up to 2008.
Lessons from 2008
The 2008 global financial crisis was partly fuelled by risky mortgage lending—offering loans to buyers with little to no equity or proper affordability checks. When interest rates rose and prices dropped, many defaulted, triggering a collapse in confidence and value.
While regulation has improved since then—stress testing, stricter affordability criteria, and targeted eligibility—the re-emergence of deposit-free mortgages echoes that era. We must question whether current lending practices, while better policed, are again becoming too relaxed under pressure to stimulate housing activity.
Awareness and Action for Landlords
It’s understandable that landlords and investors are watching this trend closely. Any shift in buyer behaviour or lending practices can have knock-on effects for the broader housing market. While these new mortgage products are unlikely to trigger a bubble on their own, they’re still worth monitoring as part of the overall demand-side pressure.
Navigating the Market
While it’s too early to say whether these products will lead to long-term structural change, they do represent an interesting development in the post-pandemic property market. For now, it’s more a sign of financial innovation aimed at increasing access to ownership than a red flag.
Though concerns may arise about history repeating itself, the presence of regulatory controls, targeted eligibility, and more cautious lending criteria suggest that today’s conditions are fundamentally different from those that led to the 2008 collapse.
Final Thoughts
Barclays’ zero deposit mortgage marks a noteworthy shift in lending policy—but not necessarily a risky one. For landlords, tenants, and investors this is a trend to observe rather than a cause for alarm.
Tom Buckley
Property Manager
Pomegranate Property Management