Nationwide has revamped its policy for new-build valuations and lending.
From November 7, the lender will change their approach to allow the inclusion of a new-build premium, which is the additional value that diminishes once a property is occupied, in new property valuations.
Previously Nationwide had valued all properties on their resale value. The building society says this had been adopted to reflect concerns over transparency and pricing practices of the new-build sector during the boom.
The move will bring Nationwide and subsidiary The Mortgage Works into line with other lenders in the market.
Nationwide is also aligning the maximum LTVs for new build houses at 85 per cent across all channels. The maximum LTV for new build flats remains unchanged at 75 per cent.
Head of policy and strategy Andrew Baddeley-Chappell says: “These changes are about reaching the right balance between prudence and market support.
“We are aware from feedback from intermediaries and builders that our previous valuation approach presented some additional complexity. We hope that this change will improve the customer and intermediary experience and make Nationwide and TMW an even better choice of mortgage provider.”