North Yorkshire developer welcomes planned easing of mortgage rules

The news that mortgage rules could be eased in the quest for growth has been welcomed by Vivly Living, the award-winning Yorkshire residential property developer and builder.

The Government has urged financial regulators to look at allowing banks and other lenders greater flexibility to allow “responsible risk-taking” from borrowers.

The changes to lending rules would allow banks to issue more loans to buyers with smaller deposits.

The move comes in response to demands from Rachel Reeves for UK regulators to embrace a “pro-growth agenda” earlier this month.

Paul Brown, Vivly’s managing director, is a well-established North Yorkshire-based developer, who lives in Easingwold. He was formerly the managing director of Caedmon Homes, who completed successful developments in York, Whitby and Boroughbridge.

Currently Vivly have sWest Yorkshire developments at Shepley, Denby Dale and Skelmanthorpe.

Welcoming this initiative, Paul commented: “It’s clear that there are worries about the ailing UK economy, but the proposed easing of mortgage rules, coupled with the relaxation of planning regulations, should give the housing market the boost it badly needs. If this happens, a flourishing housing sector could kickstart an economic revival.

“Reviewing the mortgage lending rules would help with affordability issues, not just for first time buyers but also those looking to move further up the housing ladder. Banks will always lend responsibly but the current rules are restricting the number of people who can get a mortgage and so could be relaxed.

“Providing the mortgage lending rules are relaxed sensibly, the housing market will be opened up and thousands and thousands more potential buyers.

“We have weathered Covid and rapidly rising interest rates without a big rise in repossessions. Now is exactly the right time to give the UK housing market the boost it so badly needs,” said Paul. “At present the mortgage lending rules are too restrictive.”

Chancellor Rachel Reeves and Prime Minister Sir Keir Starmer have pledged to make the UK the fastest growing economy in the G7 but now face having to reduce spending plans in the face of higher-than-expected borrowing costs.

Among the areas which are expected to be examined include financial stress-testing rules that limit how much first-time buyers can borrow. At the moment mortgage lenders are only allowed to lend 15 per cent of their total mortgage “loan book” to people whose property is worth 4.5 times their annual salary.

There are also strict affordability rules that lenders must follow to make sure borrowers can afford unexpected rises in interest rates that could be scaled back. Regulators are also likely to consider altering affordability tests to include evidence of previous rental payments rather than simply income.

At the same time banks are pushing the Bank of England to reduce the amount of capital they need to keep in reserve for 90 per cent loan-to-value mortgages to open the market to first-time buyers.

Vivly Living has just been granted planning for its exciting new residential development at Shepley, near Huddersfield. Kirklees Council has given the go-ahead for 52 new homes at Knowle Grange, which will form Phase 2 at Vivly’s development in the village. Phase 1, comprising 31 homes, has completely sold out.

Work on Shepley Phase 2 is due to start imminently. It should be completed within 24 months.

Meanwhile Shepley Phase 1 was named the Best Small Housing Development in the UK in the prestigious WhatHome Awards.

Vivly’s two other developments at Denby Dale and Skelmanthorpe are proving very popular but a selection of two-five bed home remain on both sites. For further information, please visit www.vivlyliving.com