Over a year since Covid-19 was declared a global pandemic and the UK first entered a nationwide lockdown, a vaccine rollout is successfully underway and restrictions have begun easing across the country. So what can those looking to buy, sell or rent a home do now, and what can we expect next from the government’s roadmap?
As we head towards summer, we take a look at where Britain is today versus a year ago, and what the next few weeks out of lockdown are likely to bring.
Buying, selling and renting
While the first national lockdown saw shutters come down on businesses and services including estate agents, effectively putting the brakes on house moves, today the picture is much more positive.
Estates agents are back open for business and both buyers and sellers have responded well to Rishi Sunak’s stamp duty holiday, which saw properties of up to £500,000 for sale in England and Northern Ireland temporarily exempt from any stamp duty.
The move by the government to restart the housing market was so successful in fact that this year the stamp duty holiday was extended until June 30, after which there will still be an exemption on properties up to £250,000 in value until September 30.
Well, at least some of us are getting to enjoy a holiday this year!
The extension is great news for anyone looking to invest in a property above the usual stamp duty threshold of £125,000, although the advice is not to leave it too late if you do want to take advantage. CEO of the Guild of Property Professionals, Ian Mckenzie, was just this week quoted by homebuilder.co.uk as saying there’s been a 12% year-on-year increase in the time it’s taking for property sales to complete, with the average sale now taking 121 days in 2021 versus 106 days in 2020.
Coming back to the hot topic of holidays…
The arrival of sunshine in the UK seems to have hit at just the right time too, with April 12 ushering in another round of restrictions easing – this time allowing outdoor pursuits and meet-ups of up to six people (or two households) to resume.
This spelled great news for those missing activities such as golf, tennis and swimming, as well as for pubs and restaurants with gardens, who can now welcome customers back for food and drink in outdoor areas.
The previous restrictions around keeping travel local have also now been lifted, with overnight stays in self-catering accommodation now allowed under the current guidance. As you might imagine, after a tumultuous year of holiday uncertainty that saw restrictions on movement come into effect on multiple occasions, the news that self-catering holidays could recommence was welcomed by those with accommodation for hire (as well as holiday hungry Brits desperate for a getaway).
In fact, with lingering uncertainty around international travel still to be put to bed, and the government pushing summer 2021 as the year of the British staycation, now presents a great opportunity for those with self-catering accommodation to capitalise on the easing of restrictions and pent up consumer demand. It’s an income potential that doesn’t seem to have been lost on those with space to spare, with private rental platform Airbnb reporting a 2.5% worldwide increase in its active listings in February 2021, compared to the same month in 2020.
New builds and first time buyers
Along with existing homeowners, second homeowners and landlords, first time buyers trying get on the property ladder are also finding themselves in a positive position as we head into summer and further out of lockdown.
April (a pivotal month for change it seems) saw the new Help to Buy scheme come into effect, which now includes regional price caps to reflect where home prices are higher, like London for example. Unlike previous iterations of Help to Buy, the new scheme is only open to first-time buyers purchasing a home from a homebuilder who is registered under the Help to Buy equity loan scheme.
First time buyers wishing to make use of Help to Buy can benefit from borrowing a minimum of 5% or a maximum of 20% (40% for London properties) under the terms of the scheme, with no interest to pay on the loan for the first five years.
Another positive for those looking to get out from under parents or off the rental hamster wheel is the introduction of the Government Mortgage Guarantee, announced in this year’s budget. This move opens the door for those with just a small 5% deposit to be able to take out a 95% loan to value mortgage on properties up to the value of £600,000, which is yet another welcome boost to those looking to get onto the housing ladder this year.
With the government set to make announcements in early May about international travel and then opening up indoor dining and other venues from the 17th onwards, the future is currently looking very bright for Britons right now.
To talk to a qualified mortgage broker about your financial circumstances and the mortgage products that may be available to you, contact Threshold today.
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