Copy article

As rates drop, NatWest increases LTVs on new build: "a sure sign that lenders have confidence in the economic outlook"

ended 26. June 2024

In another sign of the growing confidence among lenders, NatWest has today announced that, with immediate effect, it has increased the maximum loan to value (LTV) for new build properties. Its new LTVs are as follows:

  • New Build residential houses: 90% LTV, up from 85%.
  • New Build residential flats: 85% LTV, up from 75%.

Newspage asked brokers for their thoughts, below. One said: “It's the hottest day of the year and the sun is shining on the new build sector.” A second said: "Rates have been coming down across this week and now loan-to-values are going up, a sure sign that lenders have confidence in the economic outlook"." A third added: “The loosening of criteria can be just as important as rate cuts to get this market moving.”

9 responses from the Newspage community

Copy all

Star Quote
Copy

Editor
Simon Bridgland
Director at Charwin Private Clients
It's the hottest day of the year and the sun is shining on the new build sector. With NatWest giving borrowers an immediate increase of loan amount on new build flats by an extra 10%, and houses by an extra 5%, this is the perfect complement to their recent rate cuts. This is a massive boost to borrowers seeking to buy new homes and reflects the escalting market confidence we now have.
Star Quote
Copy

Editor
Emma Jones
Managing Director at Whenthebanksaysno.co.uk
Rates have been coming down across the board this week and now loan-to-values are going up, a sure sign that lenders have confidence in the economic outlook. This week is like a repeat of the first week of the year when lenders were competing aggressively for market share. The second half of the year is shaping up to be the polar opposite of the first half, which has been relatively subdued overall. Hesitation has been replaced with hope.
Star Quote
Copy

Editor
Adam Stiles
Managing Director at Helix Financial Partners
Rates drops and increasing loan-to-values are a great sign of confidence in the mortgage market and we expect other lenders to follow suit with criteria tweaks. The sun is beginning to shine more and more on the mortgage industry. The current warm front is not just meteorological but mortgage-based.
Copy

Editor
Riz Malik
Independent Financial Adviser at R3 Wealth
Lenders are now competing not just on rate but criteria, and that's a huge win for borrowers. The good news is now coming in stereo. The loosening of criteria can be just as important as rate cuts to get this market moving. With enquiry levels for mortgages rising even without a base rate cut, this market seems to be more resilient than expected. It bodes very well for the second half of the year.
Copy

Editor
Craig Fish
Director at Lodestone Mortgages
This is a very big move and shows confidence in the new build sector. There are already lenders in the market at this level but for a big lender like NatWest to show support in this way reflects that the dynamics in the market are changing, with the popularity of new builds increasing.
Copy

Editor
Ben Perks
Managing Director at Orchard Financial Advisers
It's easy to get sucked into competing on rate, but NatWest have made a savvy play and improved criteria, too. Upping the loan-to-values available on new builds helps to lower the barrier for borrowers who are frantically trying to save for deposits. This will give people a much needed boost in confidence. With lenders starting to combine these criteria changes with slightly lower rates, buyers look set to become much more active in the second half of 2024.
Copy

Editor
Rohit Kohli
Director at The Mortgage Stop
Another positive from the UK's biggest lender, which seems to point towards growing confidence in the market. This will be welcome news to borrowers who are trying desperately to get onto the property ladder. Coupled with rate reductions this week, as long as there are no surprises on inflation, the second half of this year could provide plenty of opportunities for would-be buyers. It feels like the property market is back.
Copy

Editor
Ranald Mitchell
Director at bad credit mortgage specialists Charwin Mortgages
NatWest's criteria move signals a strong resurgence in confidence in the property market. By increasing high loan-to-value offerings, NatWest is not only demonstrating its optimism but also gearing up to compete vigorously with other lenders for market share. This is excellent news for borrowers, as it suggests more competitive mortgage options and improved lending conditions on the horizon.
Copy

Editor
Stephen Perkins
Managing Director at Yellow Brick Mortgages
Once the rate-lever has been pulled as far as it will go, lenders turn their attention to other factors to influence their market share, such as increasing loan-to-values or relaxing criteria. This shows the appetite for lending is still there and should open up options for more borrowers, which can only be good for the market.