According to an analysis of Land Registry data carried out by Leeds Building Society, 51,602 extra homes sold over the last year would have been available to first-time buyers.
This is equivalent to a 65% increase in the homes accessible to first-time buyers in England and Wales, resulting from loan to income (LTI) adjustments made by lenders.
In July, the Prudential Regulation Authority gave lenders permission to exceed LTI limits to allow people to borrow more relative to income.
Leeds Building Society was one of the lenders that reacted to the policy, and lowered the minimum income needed to £30,000 for higher LTI borrowing to single or joint applicants accessing up to 95% loan to value (LTV).
This means first-time buyers on the minimum salary could borrow as much as £165,000 and buy a home worth £173,000.
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Before these changes, a first-time buyer with a 5% deposit could have purchased a home worth up to £141,000 when borrowing from Leeds Building Society.
From 1 July 2024 until 31 June 2025, the number of homes that would have been available if the lending rules were in place rose to 143,017, up from 86,915, representing a 65% increase.
Martese Carton, director of mortgage distribution at Leeds Building Society, said: “Affordability remains a challenge for many would-be homeowners, with house prices still outpacing wage growth in several regions. But brokers should be reassured to know that a £30,000 income is enough to help their clients achieve their homeownership dreams.
“According to our analysis, the number of homes available to buy has increased hugely as a result of affordability changes made across the market, and increasing our maximum loan for those earning £30,000 or more means that 65% more properties would have been within reach.”
Lending rules make homeownership accessible
Other changes Leeds Building Society introduced to improve affordability include a reduction in its stress rate and allowing first-time buyers to borrow 5.5 times their income through its Income Plus range.
Rachel Geddes, strategic lender relationship director at the Mortgage Advice Bureau, said: “It’s an undeniable fact that affordability remains the single biggest hurdle for aspiring homeowners. Our research shows 65% of renters aspire to buy, yet a discouraging 27% believe homeownership is completely out of reach.
“The truth is, many aspiring buyers simply don’t realise they’re in a position to get on the property ladder. Our job as brokers is to change this narrative and raise awareness of the innovative mortgage products available.
“Leeds Building Society’s recent lending criteria adjustments and wider first-time buyer range represent a crucial step in our industry’s commitment to making homeownership accessible, empowering brokers to say ‘yes’ to even more customers.”