First-time and new buyers are being urged to tread carefully amid a surge in mortgage applications since the housing market reopened in May and the Stamp Duty holiday was announced last week.

Online mortgage broker Trussle said it is now on track for its busiest year so far, despite the market pause, with first-time buyer applications up 182% between May and July and a 176% spike in new buyers seeking mortgages.

The broker said many will benefit from the Stamp Duty holiday, with 64% of its mortgage enquiries over the past month focused on properties priced at £500,000 or under.

However, it warned there’s a very limited range of low deposit mortgage products available at the moment, while property supply is also down.

This time last year there were 145 products available for buyers with a 5% deposit, whereas currently there’s only one, Trussle said.

Miles Robinson, head of mortgages at Trussle, said: “Like many other industries, the mortgage market is undoubtedly in a state of flux, with house prices fluctuating and lenders pulling mortgage products.

“But, the more positive news is we’re beginning to see some green shoots. House buying has for decades been a sign of economic recovery and we believe this situation is no different.

“Estate agents are recording a real surge in demand for houses.

“Similarly record interest rates mean there are some great deals for those who are in the right position.

“However, we still need to tread carefully. The Stamp Duty holiday will undoubtedly add a much-needed boost for those who are looking and able to buy. Over time, we hope to see lenders add a wider variety of products to the market to make home ownership more accessible.”