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Government help for home buyers

In the March 2021 Budget, the Government announced how they would be helping to keep the housing market moving, by extending the stamp duty holiday, and by the introduction of a 95% mortgage guarantee scheme. We’ve summarised the key facts so you can see how these initiatives may be able to help you buy your next home. 

Mortgage guarantee scheme – from April 2021 until December 2022

This scheme allows people with 5% deposits to purchase a home – whether they are first-time buyers, or just planning on moving between properties. New builds and existing properties up to the value of £600,000 are eligible, as long as the property is going to be lived in by the purchaser and not bought as a buy-to-let or holiday home.

This is a massive boost to the housing market as the number of 95% mortgages available to first-time buyers went from nearly 400 to just 3 over the course of the COVID-19 pandemic. Banks and lenders were worried about large-scale lending and so withdrew many of their products, which stopped or delayed home purchasing plans for many people. 

This scheme encourages banks to offer 95% mortgages as the Government will take on some of the associated risks of high loans. Major banks such as Barclays, HSBC, Lloyds Bank, NatWest, and Santander are taking part in the scheme and other lenders are set to follow suit. 

Louise Lewis, smarthomes’ in-house Mortgage Consultant, commented ‘This new scheme will help both those without large deposits, and those looking to buy their first home. To find the right mortgage that meets your needs, it’s best to work with a mortgage consultant who can access market-wide deals and help ensure you meet eligibility and affordability criteria.’

Stamp duty holiday – extended until 30 June 2021

The stamp duty holiday gave thousands of people the opportunity to save up to £15,000 on their next home purchase, by not charging any stamp duty on the first £500,000 of a property. It did what it set out to do, to boost the housing market during the COVID-19 pandemic, but it resulted in huge delays as estate agents and solicitors became overwhelmed with the demand.

The extension of the scheme until the end of June allows those home moves in progress to be competed and minimises the chance of sales falling through which would be devastating for both sellers and buyers. To avoid this happening again after the end of June, the Government have introduced anther tier from 1 July to 30 September: no stamp duty will be charged on the first £250,000 duding this time. The original threshold of £125,000 will apply from 1st October.

Jamie Smart, Director of smarthomes commented, ‘This extension gives buyers and sellers the confidence to proceed with their home moving plans. We know how devastating it is when house plans and chains fall apart so at smarthomes we do everything in our power to keep the process moving, and to communicate frequently with our clients so they are always up to speed.’

To find out more about our independent mortgage advice please call Louise Lewis on 0121 744 4144 (option 2) or click here:

To find out why you should choose smarthomes to sell your home:

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