The building society said the move to dispense with the £500,000 cap will support the London and South housing markets in particular, where first-time buyers with good jobs and deposits struggle to meet lender affordability criteria.
With average monthly rent payments in London estimated at £1,500, removing the maximum loan size cap will enable many more to get on the housing ladder, said the mutual.
Kris Brewster, Skipton’s head of products, (pictured), said: “It’s important that we continually review our lending criteria, as we all know how fast the UK mortgage market changes. People who have good jobs, earning very healthy salaries, and have saved up large deposits, are still being priced out of the south and London markets. This move will enable more first-time buyers to move away from renting, and to get the keys to their first home.”
UK house prices increased 20% between 2011 and 2015 with London prices increasing 53% across the same period with the average price paid for a London flat at £545,000 in 2015.