Nottingham Building Society opens the door to ex‑local authority flats with 85% LTV lending

Nottingham Building Society, the mortgages and savings mutual, has announced a new series of lending enhancements, with the highlight being the inclusion of ex‑local authority flats. 

The Society will now lend on any flats previously owned or managed as social housing but now part of the private market — a sector estimated to include around one million properties across the UK. The Society will accept lending on these units up to 85% loan‑to‑value (LTV). This applies across both residential and buy‑to‑let, widening access for first‑time buyers and landlords alike. 

Beyond property types, Nottingham Building Society has also updated how it assesses deposits and purchase routes. These include: 

• Housebuilder gifted deposits – accepted on new‑build properties, provided the borrower matches the gift with their own funds.
• Concessionary purchases from landlords – allowing private landlords to sell to existing tenants at a discounted price, supporting smoother transitions and reducing friction for both parties.
• Repayment of a director’s loan as a deposit source – enabling self‑employed applicants to use funds owed to them by their company towards their deposit, where the repayment is fully evidenced. 

These updates follow the lender’s recent expansion of acceptable income types across residential, foreign national, returning expat and retirement interest‑only (RIO) ranges, including agency and zero‑hours work, certain state benefits, and drawdown pensions. Together, they form part of the Society’s ongoing programme of practical, criteria‑led improvements designed to widen affordability and reduce barriers for borrowers overlooked by mainstream providers. 

Matt Kingston, Sales Director at Nottingham Building Society, said: “These are changes rooted in what we’re hearing every day from brokers. Ex‑local authority flats form a huge part of the UK’s housing stock, yet support for them remains patchy. Landlords are increasingly selling directly to tenants. Self‑employed customers are relying more on legitimate capital flows. And new‑build purchases can be made possible only when housebuilders step in to help with deposits. 

“None of these are niche scenarios. They are the reality of today’s property market. 

“Our role as a modern and specialist mutual is to respond to real‑world circumstances with clarity and common sense. By expanding our criteria in these four areas, we’re removing unnecessary barriers, strengthening viable routes into homeownership, and giving brokers more confidence when placing cases that fall outside a narrow definition of ‘standard’. 

“We’re building meaningful momentum through 2026, and these enhancements are another step in ensuring our lending reflects the way people actually move, work and save today.” 

These changes add to the ongoing development of the Society’s lending proposition, including earlier updates this year such as recognising confirmed future income, simplifying routes for self‑employed applicants, increasing maximum LTVs for new‑build flats, and removing LTV caps on lending into retirement. 

Nottingham Building Society will continue evolving its specialist and residential lending ranges throughout 2026, aligned with its commitment to supporting brokers and borrowers whose circumstances do not fit outdated models.