Chancellor Rishi Sunak delivered his Budget to the commons earlier in the month, outlining his plan for the UK economy over the next year. There were several key elements that will affect the housing market:
Stamp duty
The nil rate band up to £500,000 will end on 30 June, instead of March. A transitional nil rate band up to £250,000 will be in place until September and then return to £125,000 from October. The pre-Covid stamp duty rates will therefore be reintroduced on October 1st 2021.
The extension to the end of June, followed by the transition to the end of September, is much needed to help prevent sales falling through as the initial deadline approaches.
Support for first-time buyers
The UK Government has introduced more support for first-time buyers with a new mortgage guarantee scheme which will encourage lenders to offer 95 per cent mortgages.
This will help first time buyers tackle the issue of deposits, which is often the first hurdle that prevents them getting on the housing ladder.
Business rates
The Chancellor announced a continuation of business rates relief. Eligible retail, hospitality and leisure properties in England will continue to receive 100 per cent relief until the 30 June 2021, this will then be discounted by two thirds for the rest of 2021.
Mark Hayward, Chief Policy Adviser of Propertymark said: “The extension of the Stamp Duty holiday to the end of June followed by the transition to the end of September is much needed to help prevent sales falling through as the initial deadline approaches. We urge the Governments in Scotland and Wales to follow the UK Government’s lead on this.”
“We know from our own research that failed sales cost consumers more than £1500 which is why we have called on Government to rethink the Stamp Duty holiday timings. This is good news for the market and will help maintain consumer confidence for those who are seeking to buy and sell in the coming months.”
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