Nationwide is set to increase the maximum loan-to-value (LTV) on new build houses to 95% from 26 June, in a move which could provide a shot in the arm to both the first-time buyer market and the housebuilding sector.
The mutual will also allow borrowers to access its Helping Hand proposition at the full 95% LTV, making it the largest lender in the UK to offer up to six times income at this level of borrowing.
The changes mark a significant ramping up of Nationwide’s support for new housing supply, as the government continues to emphasise delivery and affordability as core housing priorities.
The Helping Hand scheme, launched in 2021, enables eligible first-time buyers to borrow up to a third more than under standard high LTV rules by increasing the income multiple from 4.5 to six.
The initiative has helped more than 57,000 customers to date, with a surge in take-up over the past year – over 26,000 borrowers used it between April 2024 and March 2025 alone.
NEW BUILD SLUMP
Mortgage-backed purchases of new build properties are down by around a third this year compared with 2022, the final full year of the Help to Buy scheme. The fall reflects ongoing affordability pressures and deposit constraints – challenges that Nationwide’s latest changes are designed to address.
The uplift will not be limited to houses. Nationwide will also increase the maximum LTV for new build flats to 85%, and extend mortgage offer periods on new build purchases from six months to nine.
While most completions fall within six months, the change is aimed at reducing the risk of borrowers needing to reapply should construction timelines slip.
Henry Jordan, director of home at Nationwide, said the building society’s trio of changes reflected its role in supporting growth: “Not only are we increasing lending up to 95 per cent LTV on new build properties, but we are also offering first time buyers the ability to borrow up to six times’ income through our Helping Hand proposition on new builds.
“In addition, we’re extending our mortgage offers to nine months – recognising the construction delay that can occur with new build properties and giving greater peace of mind to applicants.”
LTI CAP STILL RESTRICTIVE
He added that the move could help to unlock latent demand that has remained unaddressed since the withdrawal of Help to Buy, but warned that the wider impact would remain constrained unless regulators reviewed the cap on high loan-to-income (LTI) lending.
Under current rules from the Bank of England’s Financial Policy Committee, lenders must keep loans at or above 4.5 times income below 15% of their total new lending.
Jordan said this limit meant that Nationwide would need to carefully manage volumes, despite the clear need for support in the market.
Housebuilders welcomed the announcement, which they said would strengthen buyer confidence and underpin new supply.
UNDERLYING DEMAND
Adrian MacDiarmid, of Barratt Redrow, said: “These latest changes are a testament to their commitment to the market, and we believe will help more buyers on this journey. Improving affordability and access to home ownership helps underpin housebuilders’ confidence to invest in order to deliver the homes that this country needs.”
Ceri Pearce, UK sales and marketing director at Taylor Wimpey, added that Nationwide’s policy shift “reflects a strong commitment to supporting the housing market and responding to the underlying demand for new homes”.
CRITICAL TIME
The changes have also been positively received by intermediaries. Terry Higgins, group managing director at The New Homes Group Mortgage Services, said the new 95% LTV mortgage and nine-month offer period was a “welcome move that will support first-time buyers… at a critical time”.
Matt Halder, of Threshold Mortgages, said the changes marked “a significant step forward” for advisers working in the new build space, and would lead to a “more seamless and efficient experience” for purchasers.
