As we found out after the 3rd March 2021 Budget, the property market has quite the buzz about it with plenty of positive news floating around. We also found out how the British economy is going to recover after the effects of the past year.
Chancellor Rishi Sunak gave us all a look at how he plans to revitalise the mortgage market. People in the industry and homeowners alike are both very happy to hear the news announced. For now, the end almost seems in sight for this pandemic era.
In October 2020, 90% mortgages finally made their way back into the market. During the surrounding months in that period, it felt like it would be a while until 95% LTV mortgages would come back.
After Rishi Sunak’s 2021 Budget, we were very pleased to find out that 95% are finally making a comeback to the mortgage market. An important thing to remember however, is that the name of the scheme is rather misleading to prospective homebuyers and home movers. Whilst this is hugely positive news, not everyone that applies for a house under the scheme is going to be guaranteed a mortgage.
Lenders will still be assessing your credit score as they have been, making sure that you are financially capable of affording a mortgage alongside all of the other financial commitments that might be under your name. A mortgage lender will always try to avoid repossession if they can, only ever doing so if they truly have no choice. Another positive announcement though is if that happens, then the new government scheme would cover any shortfall.
For a while now, homeowners and lenders alike have been worried about the potential for current home values dropping. This measure that has been introduced should help calm their minds. Of course, the chances of negative equity occurring will naturally reduce should we see property prices on the up again, thanks to these announcements.
The Chancellor announced that both First-Time Buyers in Nottingham and Home Movers in Nottingham will be able to access and utilise the 95% Mortgages scheme. This is not just a scheme for New Builds and can be used by anyone on any property.
The new government 95% Mortgage scheme will be available from April 2021 and continue to run until December 2022. According to Chancellor Rishi Sunak, many credible and huge lenders have already shown their support for the new scheme.
As a Mortgage Broker in Nottingham with many years of experience in the industry, we are incredibly happy to hear this news and are excited to see where the market goes next.
Well, 95% mortgages making their way back into the market was just the beginning it seems, as it was announced that the Stamp duty holiday has been extended until 31st June 2021.
Back in 2020 when the Stamp Duty Holiday was first introduced to us, we all probably thought COVID would pass and life would carry on as it always had. Unfortunately, things didn’t quite work out like that. Solicitors are struggling to keep up with work pressures and if lots of chains had closed down, then it would have partly defeated the objective of trying to encourage people to undertake Moving Home journeys.
To keep the property market ticking over, and to carry on home purchases, the Government have opted to extend the current Stamp Duty Holiday. Property purchases up to £500,000 will continue to stay tax-free until 30th June 2021 and property purchases up to £250,000 will also stay tax-free until September 30th 2021.
Now that the market is on the up again and 95% mortgages are going to be making their grand return, we’re hoping that this is the sign that we needed that normality is on the horizon. Of course, it will still be a while before things are completely normal again, but this is a good place to start for the property market. The Government certainly sees the importance of the property sector, one that can surely play a huge part in the recovery of our economy.
The government are really pushing for people to transition back into buying over renting, as can be seen by the introduction of the new “mortgage guarantee” scheme. Seeing this news as a dedicated Mortgage Broker in Nottingham brings a level of optimism back to ourselves and others involved in the sector.
We are still open and here to help with all your mortgage & protection needs. Our fast & friendly team of mortgage advisors in Nottingham are available from 8am – 10pm, 7 days a week, so Get in Touch and we’ll get the ball rolling on your process.