Nationwide Building Society has urged the UK government to reconsider mortgage lending restrictions as first-time buyers face mounting affordability challenges. The lender, which provided more first-time buyer mortgages than any other bank or building society in 2024, argues that raising loan-to-income caps could help more people get on the property ladder.
Nationwide Leads in First-Time Buyer Lending
Nationwide has cemented its position as the UK’s top lender for first-time buyers, according to industry data from CACI. The building society led mortgage lending for this demographic in eight of the 12 months of 2024 and was the top provider throughout the year’s second half.
In total, Nationwide issued over 180,000 mortgages last year, with more than a third of these going to first-time buyers.
A key factor in Nationwide’s success has been its Helping Hand mortgage, which allows higher loan-to-income lending of up to six times a borrower’s salary. This initiative, introduced in April 2021, accounted for 23% of the society’s first-time buyer mortgages in 2024.
According to the building society, the scheme has played a significant role in tackling the affordability barrier, particularly as rising property prices make it increasingly difficult to save for a deposit.
The average loan size for first-time buyers through Nationwide has increased significantly over recent years. In 2020, it stood at approximately £159,000, whereas in 2024, it reached around £197,000.
For those using the Helping Hand scheme, the figure was even higher, at an average of £249,000—26% above the general first-time buyer loan size.
Call for a Review of Lending Restrictions
Despite its initiatives, Nationwide is constrained by regulatory limits that cap lending at 4.5 times a borrower’s income for 85% of new loans.
The remaining 15% is allowed to exceed this threshold, but Nationwide allocates most of this allowance to first-time buyers. The society argues that revising these restrictions could provide much-needed relief to those struggling to enter the housing market.
Henry Jordan, Nationwide’s Director of Home, stated: “We believe it’s important to put first-time buyers first given how tough it is to get on the housing ladder. Our enhanced Helping Hand mortgage is extremely popular with first-time buyers, and we are committed to finding new ways to ease affordability. Increasing the loan-to-income lending cap would also enable lenders to support more first-time buyers.”
