The missing link between ‘Build, Baby, Build’ and ‘Buy, Baby, Buy’

One of the key issues of course is that building homes and selling them are two very different challenges. Without a clear path for buyers - particularly first-timers - this drive risks stalling before it even begins. And that’s where lenders inevitably come in.

Related topics:  New build,  Government
Patrick Bamford | Head of International Business Development at Qualis Credit Risk, part of AmTrust International
9th October 2025
Patrick Bamford - AmTrust

When you hear the new Secretary of State for Housing speaking about the need for a ‘Build, Baby, Build’ culture across the country then it’s not surprising that ears have pricked up. 

No doubt, that statement in itself is a lot to live up to, and an ambitious stall being set out. We are just over one year along in terms of the Government’s stated ambition to build 1.5 million new homes by the end of this Parliament, and while few would argue with the logic of building more, it’s not entirely clear if we’ll see the numbers get anywhere near this level. 

One of the key issues of course is that building homes and selling them are two very different challenges. Without a clear path for buyers - particularly first-timers - this drive risks stalling before it even begins. And that’s where lenders inevitably come in.

For lenders, this is a moment to take stock of the market dynamics shaping both supply and demand. High LTV lending has been the critical enabler for first-time buyers in recent years, yet in the past month we’ve seen a noticeable dip in product availability. 

Whether that’s a temporary retreat ahead of November’s Budget or a more cautious recalibration remains to be seen. But what it does reveal is how finely balanced lender appetite is in this part of the market, and how closely it might track political noise.

The recent correlation of the two might not be a coincidence. Whenever talk of housing incentives surfaces, the market tends to pause with a wait and see attitude prevailing. 

The high LTV sector is uniquely exposed to policy shifts, because the presence, or absence, of Government support can significantly alter risk perceptions. We’ve been here before. 

The end of Help to Buy created a clear demand gap, one that the Mortgage Guarantee Scheme hasn’t really filled at all. Now, with the Government once again talking about homeownership as a national mission, lenders are understandably watching for signals. Are we about to see a successor to Help to Buy, for example?  Or is the expectation that the market should absorb this challenge?

The answer matters because the success of ‘Build, Baby, Build’ ultimately depends on ‘Buy, Baby, Buy.’ Developers can build 1.5 million homes, but unless there are enough willing and able buyers - backed by accessible mortgage finance - that target will remain a slogan rather than a reality. 

And for all the focus on planning reform, construction incentives and brownfield development, the affordability equation for many first-time buyers still doesn’t add up. Deposit requirements remain a stubborn barrier, even as wages slowly recover.

This is where lenders could be the missing link in the Government’s housing strategy. The new-build sector has always carried its own nuances - from valuation sensitivities to developer incentives and tighter lending criteria - but it is also one of the few parts of the market that can directly support economic growth. 

Lenders that can confidently serve first-time buyers purchasing new-builds not only unlock transactions but also help underpin the broader ambition of sustainable homeownership.

That, however, requires clarity. Policymakers and lenders have to work in tandem. If lenders are to play their part, they need visibility on the framework they’ll be operating in. 

Does the mortgage guarantee scheme support enough 95% LTV lending? Or would that money be better spent elsewhere? Will there be a targeted measure to help first-time buyers with deposits, or a revision to stamp duty thresholds? Are we getting son/daughter of Help to Buy? And what might it look like? 

These are the kinds of policy details that shift lending behaviour at the margin, and right now, the margin is tight.

None of this is to suggest lenders are holding back unnecessarily. The past few years have demonstrated a strong willingness to innovate, from joint borrower/sole proprietor products to family assist mortgages and bespoke new-build ranges. 

What lenders are rightly cautious about is sustainability: ensuring high LTV lending doesn’t equate to high-risk lending. Which of course is where private mortgage insurance can play a huge part in terms of mitigating that risk, providing the scope to lend, and still offering highly-competitive products. 

The Consumer Duty environment makes that more important than ever. Lending decisions must balance ambition with prudence, particularly when the borrowers in question are navigating the process for the first time.

If the Government is serious about creating a generation of new homeowners, it will need to think as much about how those homes will be bought as where they will be built. For lenders, this may mean preparing to re-engage at higher LTV levels once the policy landscape becomes clearer, but doing so with products and criteria designed for long-term resilience rather than short-term volume.

Ultimately, ‘Build, Baby, Build’ can only succeed if matched with an equal focus on enabling buyers. Lenders will always do their part to keep the ladder within reach, but I suspect the next step must come from policymakers who should recognise that access to finance is every bit as vital as access to land.

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