Nationwide introduces new property value 'limit' for mortgage customers

The building society is to let first-time buyers borrow up to six times their earnings in what has been labelled a “gamechanging” move that ramps up the mortgage price war.
-Credit: (Image: Reach Publishing Services Limited)


Nationwide will allow first-time buyers to borrow six times their earnings. The building society is to let first-time buyers borrow up to six times their earnings in what has been labelled a “gamechanging” move that ramps up the mortgage price war.

Nationwide is also cutting its mortgage rates and increasing its maximum loan sizes, so that someone taking out a home loan for more than 90% of the property’s value will now be able to borrow up to £750,000 – up from the existing £500,000, and higher than the £570,000 limit at many rivals.

Nicholas Mendes, a mortgage technical manager at the broker John Charcol, said Nationwide’s move was “a gamechanger for first-time buyers” that would “deliver a powerful boost” towards tackling the significant affordability issues that had locked many out of home ownership.

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David Stirling, an adviser at Mint Mortgages & Protection, said: “These are significant improvements … potentially increasing borrowing availability by up to 33%.” Nationwide’s House Price Index shows the average first-time buyer property price in the UK is £226,794. However, this varies widely across the country.

Helping Hand has proved particularly useful in the Outer South East where the average first-time buyer house price stands at £262,504, and where uptake of Helping Hand has been highest. (28% of all Helping Hand mortgages and 15% of all Nationwide’s first-time buyer mortgages were recorded in the Outer South East region).

Nationwide is also increasing its maximum loan sizes, including those above 90% LTV, which will increase from £500,000 to £750,000. This change is also effective from Tuesday 24 September. According to UK Finance data, around five per cent of all house purchase loans were over £500,000 in the six months to June 2024 – a figure even higher in London.

Since 2021, Nationwide has lent more than £7.5 billion through Helping Hand – supporting around 40,000 people onto the property ladder.