Nationwide has launched a scheme to allow smaller builders to offer NewBuy who on their own are unable to hit the minimum amount of properties needed to qualify for the scheme.
On March 12 when Nationwide first launched its NewBuy proposition it had agreements with six building firms – Barratt Developments, Taylor Wimpy Homes, Persimmon Homes, Bellway Homes, Bovis Homes and Redrow, with Linden Homes and Crest Nicholson signing on a week later.
To qualify to have an individual relationship with lenders on NewBuy builders are expected to be able to build around 100 properties over three years.
This is because they need to have a spread of properties so the risk can be spread in order to get the capital relief that is a feature of the scheme.
Andrew Baddeley-Chappell, head of mortgage strategy and policy at Nationwide, says: “It needs to be a fairly big builder to enter into these individual relationships.
“100 properties is a ballpark figure – that 100 is 100 per lender if you like, so if there are five lenders in the scheme, they would need to provide 500 properties.”
But for smaller builders who are unable to hit this minimum requirement of properties Nationwide has now added a multi-user agreement.
Baddeley-Chappell adds: “This is for builders that aren’t building on enough scale so they in effect pull together – this means you then begin to allow a larger range of builders into the scheme.”
Fairview New Homes is the first builder to sign on to the multi-user agreement with Nationwide for NewBuy.