Savills: Lending Rule Changes Could Boost Contractor FTB Numbers by Up to 24%

First-time buyers and property professionals — change is coming. With mortgage stress tests easing and lender criteria loosening, the property market may be on the brink of transformation.

A significant shift in UK mortgage lending is expected to unlock the housing market for thousands of first-time buyers. Following a Bank of England policy adjustment in March 2025, lenders are no longer required to apply the same stress test thresholds — specifically, assessing borrowers at the standard variable rate plus 1%. Major lenders including Nationwide and Barclays have already adjusted their affordability criteria, making borrowing more accessible for many. According to new analysis from Savills, this could result in 47,000 to 80,000 additional first-time buyer transactions over the next five years — a rise of 14% to 24%.

While more relaxed lending rules are expected to help more people onto the property ladder, Savills warns this demand boost could also push house prices higher. Depending on how much new housing stock is delivered, prices could rise by an additional 5% to 7.5% above current forecasts. Lucian Cook, Savills’ Head of Residential Research, explains: “These lending changes will reshape the market in the medium to long term. But the effect on transactions and pricing will be influenced by how much borrowing power translates into actual purchases — especially in a market still shadowed by economic uncertainty.” He also notes that while the immediate impact may be muted, over time a larger pool of potential buyers will shift market dynamics — good news for housing developers, though likely not enough to help the government meet its building targets.