Stamp Duty & 5% Mortgages – The key points from Mr Sunak’s Spring Budget
What was announced in the Spring Budget?
The spring budget for 2021 is being looked at carefully as it will set the precedence for the UK to leave lockdowns and will help boost the economy going forward. It’s one of the most important budgets in recent years. Rishi Sunak looks to outline the economic support going forward for the country. He will likely touch on furlough extension, stamp duty exemption, business rates and further tax and spending measures. Overall the government has funded £280bn worth of support.
How does this effect the property market?
The two announcements that are most key are those surrounding the stamp duty exemption and the government backed scheme surrounding the 5% deposit mortgages. Let’s go into more detail on these below.
More details on the stamp duty exemption extension
The Chancellor announced that the 500k nil rate band will be extended from the current deadline at 31st March to a new deadline at 30th June. This will help a lot with the sheer amount of pending property purchases. If all of these fell through it could be disastrous for the whole economy. So it’s great that he has stepped in to save all the home movers.
Further to this there will be a tear down from 30th June to October 1st. Meaning that the nil rate band will go down from 500k to 250k. Still meaning a lot of people are set to save and also giving us a smoother transition to normal rates. This is really great thinking by the chancellor and will keep the property market steady. This’ll allow families of all kinds to facilitate moves without the concern of a big tax bill going forward.
The future of 5% mortgages
A new government backed 5% deposit scheme was announced today by Rishi Sunak. He has promised that big high street lenders Lloyds, Natwest, Santander, Barclays and HSBC will be offering this product in conjunction with the government. It seems they will be released as of April according the The Chancellor. With Virgin Money also looking to join the party later down the line.
What this will mean is opportunity and chance for all purchasers to get onto the property ladder with a deposit that is less hard to tackle. We await more details on the specific rates of these products and the ins and outs but we will reveal more news on this as it comes out from the government.
Contact us today if you want to discuss any of this and how it relates to your personal situation.
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