Spring Budget 2021 Change ‘Generation Rent to Generation Buy’
3rd March 2021
In a bid to keep the UK economy stable, Chancellor Rishi Sunak announces new plans to support home buyers
During today’s Spring Budget announcement, the chancellor confirmed that he would boost support for home buyers through a mortgage guarantee.
Several major lenders including Natwest, Lloyds, Barclays, Santander and HSBC have agreed to provide 95% mortgages to home buyers in return for a government guarantee on those mortgages.
Low-deposit mortgage accessibility has declined since the pandemic started, which has made home-ownership unreachable for many. But the government hopes that these plans will give more people the support and opportunity to buy their own homes.
It was also announced that the Stamp Duty Land Tax holiday in England and Northern Ireland will be extended for purchases up to £500,000 until the 30th June, meaning home buyers avoid the stamp duty levy on purchases under that amount. After this date, the starting rate of Stamp Duty will be £250,000 until the end of September, before returning to the previous level of £125,000.
Daniel Winslow, Partner and Head of Leasehold Services at Healys LLP comments:
“In the end then the announcement was largely as anticipated, but for perhaps a few additional reveals here and there. In my view extending the SDLT holiday will provide a much needed crutch for the economy to rest its weight whilst its other limbs scramble for footing as we move out of lockdown. The tapering back of the SDLT thresholds is also an interesting development and one which I am in favour of. Suddenly stopping the SDLT holiday (whether at the end of March or the end of June) would have almost certainly lead to a shock to the market and to the economy as a whole. By delaying and then tapering back the SDLT limit (and introducing the 95% mortgages) the government clearly hopes to either stop that from happening completely or at least turn that cliff edge many have been talking about into a downward hill to an eventual (hopefully high) plateau. If property transactions do decline then by the time we all get to that plateau the economy will hopefully be ready to throw away its crutch and start running!
“In terms of the 95% mortgages, I think this is an excellent introduction, provided of course it is done safely. It will give many perfectly worthy potential homeowners the chance to achieve their dreams where previously they would have been priced out of the market. Much talk has been made of a lack of housing stock, but when has there ever been enough housing? Also, who says only the cash rich should be entitled to be homeowners? I think it helps provide a level playing field, and it is one that I am all for.”
Healys LLP are award winning conveyancing solicitors based in London, Brighton & Sussex. Our conveyancing solicitors have a vast amount of experience in property law and we deal with all aspects, including the purchases & sales of homes, freeholds, leaseholds, shared ownership schemes, remortgaging, lease extensions and more. For more legal updates or legal advice, please visit Healys LLP’s website.