Great news for first-time buyers and those looking to move home as Rishi Sunak introduces a new mortgage guarantee scheme and Stamp Duty Holiday extension during the Spring budget announcement.
The mortgage guarantee scheme will allow low-deposit home buyers to get on the property ladder quicker. Rishi Sunak announced: ‘’Lenders who provide mortgages to home buyers who can only afford a 5% deposit will benefit from the Government’s guarantee on those mortgages’’. Several large banks will be offering 95% mortgages already from the beginning of April. These include Lloyds, Santander, Barclays and HSBC. Virgin Money will start offering low-deposit mortgages as well but later this year. In November 2020, Boris Johnson has promised a new scheme aiming to turn ‘’generation rent’’ into ‘’generation buy’’, which we can see in action now.
Another important announcement with regards to the Stamp Duty Holiday extension is a relief for those worrying about missing the deadline at the end of March, which could cost home buyers up to £15,000. Rishi Sunak confirmed that the Stamp Duty Holiday deadline will be extended for properties up to £500K until the 30th of June. To smooth this transition back to normal, the nil rate band will remain £250,000, double the standard level until September only returning to £125,000 on 1st October.
Kevin Murray, Area Manager, comments: ‘’These are some great news for the housing market, particularly for home buyers with only 5% deposit. We have already noticed a significant increase in valuations and viewings since the announcement. We are expecting the property market to remain same hot throughout the year!’’
Rishi Sunak announced that the total Covid-19 support package cost the Government £352 billion. The economy is expected to return to pre-Covid levels by the middle of next year. However, in 5 years time, it still will be 3% smaller than it would have been without Covid-19.