The government will urge lenders to put first-time buyers at the top of their agenda in a Treasury summit tomorrow, as ministers step up efforts to widen access to homeownership.
Lucy Rigby, the new economic secretary to the Treasury, and Matthew Pennycook, the housing minister, will host senior executives from the largest high street banks alongside Nationwide Building Society.
The meeting comes as part of the government’s “Plan for Change”, which pledges to deliver 1.5 million new homes and overhaul mortgage regulation.
The session follows the so-called Leeds Reforms, unveiled by the chancellor in July, which loosened restrictions on loan-to-income ratios. Lenders are now permitted to offer more mortgages above the traditional 4.5 times income threshold, a move designed to ease the path for households with small deposits and modest earnings.
FTB BOOST
The Treasury believes the reforms could enable up to 36,000 more first-time buyers to purchase a home in the first year. In parallel, the Financial Conduct Authority is simplifying affordability rules to allow more borrowers to qualify within what the government insists will remain “safe and regulated limits”.
Nationwide has already responded by pledging to support an additional 10,000 first-time buyers, in part by reducing income thresholds for its ‘Helping Hand’ mortgage.
PROPOSALS TO EXPAND ACCESS
The roundtable follows a separate meeting last week with building societies, where ministers heard proposals to expand access through new products such as no and low deposit mortgages for borrowers with strong credit histories. The Building Societies Association (BSA) has also been working on a campaign to raise awareness of the changes.
Rigby said: “Helping first-time buyers onto the housing ladder is central to our Plan for Change. That’s why I’m bringing lenders together to make mortgages more accessible and to highlight new options for first-time buyers – all with the aim of helping more people to achieve the dream of homeownership.”
Robin Fieth, chief executive of the BSA, welcomed the dialogue, saying: “We are pleased to see engagement with building societies and other lenders on how to better support people who can demonstrate affordability but have been excluded by outdated regulations.
“Building societies have always led the way in developing innovative solutions to help people into homeownership, and we are ready to do more.”
The government is expected to continue talks with lenders in the months ahead as it looks to translate its reforms into faster, more tangible results for those trying to get on the property ladder.
