After weeks of speculation, Chancellor Rishi Sunak has announced his Budget for the next financial year – and those looking to buy a home were near the top of his priority list.
With the promise to turn ‘generation rent into generation buy’, the Government confirmed the current stamp duty ‘holiday’ – where no tax is paid on the first £500,000 value of any property purchase – will be extended until June 30th. Staggering the stamp duty relief further, the limit will then be reduced to £250,000 until the end of September.
Great news, right? Well, there’s more!
Additionally, a range of Government backed, 95% loan to value mortgages (where you pay a 5% deposit and borrow 95% of your home’s value from the bank) – which have not been offered to buyers over the past 12 months – will be available from April, giving you more choice and further opportunity to get onto the property ladder.
So what does this mean for you? Whether you’re currently in the sales process or are now looking to start your house hunt, we’ve broken down some of the key takeaways from the Budget and how it could help you buy a home.
If you’re already in the buying process…
The pressure is off! With the current stamp duty holiday confirmed to go on until the end of June, those who were racing against the March 31st deadline can now relax – you have a bit more time to complete on your home and still save that extra cash. You can read about the stamp duty holiday in full here.
If you’re looking to start your house hunt…
Did you pause your property hunt for fear of missing the stamp duty deadline? You’re not alone!
Buying a home is a big commitment that can take some time, so it’s important to take this into account when beginning your property hunt. You can read our blog on the Reservation to Move In process for more information.
But good news – with the higher tax-free limit extended until June 30th, buyers now have three months to get the keys – followed by a further three months where the tax-free value is up to £250,000, which could still be a big saving.
Remember, as a first time buyer you already get the benefit of an increased tax-free limit of up to £300,000, so the September deadline might not be as important to you – as you’ll save money either way.
If you have a 5% deposit already saved…
While schemes such as Help to Buy and Shared Ownership have continued to help buyers get a foot onto the property ladder in the past 12 months, the return of 95% mortgages offers buyers even more variety and choice – which can only be a good thing.
The government has announced that many of the large banks, including Natwest, Lloyds, HSBC and Santander, will once again start offering 95% mortgages from April for homes under £600,000 – and other lenders are set to follow suit. This means buyers with a 5% deposit will once again be able to buy on the open market, which is fantastic news for the many house hunters out there.
Buying a home is a personal experience, and it’s important to choose the right route that best suits your individual circumstances – a mortgage advisor can help you to figure this out based on what you can afford.