Skipton Building Society has confirmed new changes to its lending criteria which will affect accessibility to the property market for prospective homebuyers.
The subsidiary of Skipton Group announced changes to its lending policy for non-standard flats this week.
This is part of the building society’s wider commitment to assisting first-time buyers and mortgage brokers.
As part of these changes, the minimum value for non-standard flats outside of Greater London has been reduced from £150,000 to £100,000.
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Skipton is looking to help Britons get on the property ladder
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The minimum value for non-standard flats within Greater London itself will remain at £300,000.
These changes come amid volatility on the property market due to fluctuating mortgage rates as lenders wait for the Bank of England to cut the base rate.
Since August 2023, the central bank has raised and then kept interest rates at 5.25 per cent which has been passed down to homeowners and homebuyers by lenders.
Those attempting to get on the property ladder have been saddled with soaring mortgage repayments amid the ongoing cost of living crisis.
While mortgage rates continue to be high for those looking to buy, the potential cost of a property being slashed will be beneficial for many households.
Jonathan Evans, the senior national account Lead at Skipton Building Society, said changes within the housing sector is pushing the financial institution to act.
He explained: “In response to evolving market conditions and our commitment to broadening access to homeownership, we have updated our policy on flats to include lending to more properties at lower market values.
“This adjustment reflects our dedication to serving a wide range of customers and communities.”
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The Bank of England base rate is at a 15-year high of 5.25 per cent GB NEWSPropertymark, the member organisation for estate agents, has called on the UK Government to cut interest rates for first-time homebuyers to help those looking to get on the property ladder.
This comes after Zoopla found Britons buying their first home are paying an average of £244,100 which is £20,300 below the local market average.
Based on the property website’s calculations, first-time buyers who got onto the property ladder in the fourth quarter of last year are paying approximately £213 more per month on average on their mortgage in comparison to the fourth quarter of 2022.
Nathan Emerson, CEO at Propertymark, added: “A fall in house prices is necessary to ease the pressure on people’s finances so they can discover an affordable middle ground to keep the cogs of the property market moving.
“Since the Bank of England stated that inflation does not need to drop to two per cent before they cut interest rates, we remain hopeful that a reduction in interest rates can happen sooner rather than later to prevent any further strain on homeowners and allow more first-time buyers the opportunity to step onto the property ladder.”