Wales’ largest building society, Principality, is extending an olive branch to help buyers in Wales get onto the property ladder.

For the first time since July 2008, the Society is set to offer Welsh buyers a 90% loan to value mortgage through its 51 branch network only, helping to reduce the pressure to raise a large deposit.

Principality’s Mortgage Manager, Christopher Johnson, said: "While the current financial climate has engendered greater mortgage affordability, the need for a larger deposit has presented a new hurdle for borrowers resulting in first time buyers being frozen out of the market."

"As a mutual building society, we recognise the plight of the first time buyer and although house prices remain vulnerable to setbacks, we believe the risk that borrowers will be left in negative equity has lessened – this has allowed us to cautiously re-enter the 90 per cent LTV market.

"Our prudent attitude to risk means that the new 90 per cent loan will be available to borrowers with good levels of affordability and clean credit histories."

Christopher continued: "At Principality our core aim since we were established 150 years ago, has been to help people to afford their own homes – this is the mutual ideal and we are committed to continuing with this aim."

According to the latest Council of Mortgages report, house purchase lending fell a significant and unexpected 26% in January, owing to a lack of movement in the mortgage market as pressure on household budgets increases.

Peter Hughes, Chair of the Council of Mortgage Lenders Cymru, commented: "Subdued lending conditions have manifested into lower numbers of housing transactions – especially for first time buyers who have been particularly hard hit by the need for sizeable deposits to raise a mortgage. The reality is that a flat mortgage market is likely to underpin 2011 as funding remains in short supply. The long term health of the housing market relies upon the revival of the first time buyer market and anything that lenders can do to help is welcome."

To find out more pop into one of Principality’s 51 branches across Wales and the Borders.

Ends

Notes to editors

• Formed in 1860, Principality is Wales's largest building society.
• The Society is committed to supporting the communities of Wales.
• With more branches (51) in Wales than any other building society, Principality is the 7th largest building society in the UK.
• The Society has assets of over £6 billion.
• Principality is committed to remaining a mutual organisation.