As the days start to get longer and spring starts to break, March 2021 looks to be moving in a much better direction than March 2020 ever did, although I will be experiencing a lockdown birthday later this month, I was fortunate to miss it by a couple of days last year!
I don’t think I have ever met anyone that looks forward to The Chancellor’s budget speech, but we all knew this one could be mission critical to getting all sectors of UK industry back on their feet after one of the hardest years, economically and socially, within living memory. With all budgets there are winners and losers, but this year has seen some amazing wins for home buyers and the housing market.
Stamp duty holiday extended.
The government has extended the stamp duty holiday that was introduced in the grip of the pandemic to stimulate the housing market and ultimately the economy; this will now remain in place for the first £500K until the end of June 2021 so home buyers will continue to save up to £15K for a short while longer. We have already seen how this saving has made a huge impact maintaining the vigour currently being experienced within the residential sales market. The threshold will then drop to £250K until the end of September 2021 and then will revert to the regular £125K. The separate first-time buyers’ threshold of £300K will resume from June- so to ensure our customers fully benefit from these tax savings, we must make sure we are continuing to make the home buying experience as seamless as possible to complete those sales before the stamp duty holiday ends.
Good news for low deposit borrowers.
The savings on stamp duty makes a real difference to home buyers, but a really exciting announcement from the government is the hope of turning ‘generation rent’ into ‘generation buy’. This is to be achieved through a new UK scheme to bring back to market 95% LTV mortgages. The initiative is only valid for standard repayment mortgages on properties costing up £600K, but not buy-to-let or second homes. To safeguard the lenders’ risk, and to inject confidence in the scheme, there is the opportunity to buy a guarantee on the amount of loan between 80 and 95%, so if the worst happens, and the property needs to be repossessed, the treasury will cover the losses to the lender on that portion of the loan. The easier access to 95% LTV mortgages will be a real boost for buyers that have the appropriate financial credentials to qualify for a mortgage, but that struggle to save the large initial outlay for a deposit. With the scheme running from April of this year right through to the end of 2022, there is plenty of time for those dreaming of owning their own home, or moving up the property ladder, to fulfil their dreams.
From these initiatives, there are real opportunities for homebuyers stuck in the rental market or in unsuitable homes and geographies, however, the property industry as a whole will also greatly benefit as these government measures are clearly aimed at supporting our industry. These moves will help stabilise the housing market, maintain demand for residential property sales, and keep estate agencies buoyant and dynamic.
Here at Hunters, both our previous and current investment in proptech, training, and building a strong brand ensured we rode out the pandemic to end up in as strong a position as possible. I’m not saying it has been easy, and I hope we never have to go through anything like this again, but the housing market can stay strong, especially when we work together. I am always available at the end of the phone, or able to pop on a zoom call to talk to our franchisees about business strategy. I also love hearing from independent estate agents that are interested in finding out how they can benefit from the strength of the Hunters brand while maintaining full control and ownership of their own successful business. If you are one of those, please do get in touch to find out more about how you can move your business forward with us.
All the best,