TMQ’s Rich: Property Market Update
Wow, almost 4 months since my last blog and how things have changed! The property market, especially in Exeter, is flying and more lenders are making more money available for more people. The stamp duty holiday has played a big part for both homeowners and investors and the Help To Buy scheme has been extended further to match.
The Mortgage Market
The property market is definitely on the rise post lock down and we have seen a return to 90% loan to value mortgages from both Nationwide and Virgin Money, which is fantastic. However these mortgage lenders are cautious so are putting in place some big caveats to make sure they can process the sheer volume of requests. Limiting to first-time buyers and focusing on longer fixed rates seem to be the preferred way to keep a handle on their turnaround times. This is in fact refreshing in a time when a lot of lenders are increasing their rates to achieve the same results.
The low down on rates
Rates are still low, higher loan to value rates have started to creep in as I mentioned earlier, as lenders try to control their service standards. Despite this, rates are still some of the lowest we have seen in recent memory, especially across the rest of the market.
Longer term fixed rates have become the battlefield seeing the most action. Why? Lenders, like the general public, want to know their houses are worth what they are paying for them and avoiding that dreaded term, negative equity. Not only do longer fixed rates give you the peace of mind, knowing your monthly payments are locked in for a good while, but also that any changes in house prices have time to settle before your remortgage comes around.
We’re all going on a Stamp Duty Holiday
The Stamp duty holiday has without a doubt been a huge factor in the recovery of the housing market. Rishi Sunak has waived the standard rate of stamp duty on all purchases up to £500,000 this means savings of up to £15,000 for the top of that bracket. Investors can take advantage of this saving too, the 3% surplus is still applicable so its not completely free but it is still a significant saving which will take the pressure off the bottom line.
In summary, the property market is still strong and rates are still low. With a fast moving local property market and significant savings to made in stamp duty, getting the extra space from a new home could be more affordable than you think.