It’s an exciting and hectic time for those looking to buy a home. Despite the pandemic halting many industries, the housing market is busier than ever before. This has been a result of three things:
- The Government’s announcement of Stamp Duty holiday up to the value of £500,000.00 until the 31st March 2021;
- The extension granted to builders to finalise the construction of New Build properties involved in Help to Buy up to the date of the 28th February 2021; and
- The extension of the current Help to Buy scheme to the date of 31st March 2021.
At the moment there is certainly a growing call for the Government to extend the Stamp Duty Holiday past its original deadline of the 31st March 2021. In December a petition was launched requesting the Government to extend the holiday. At the time of writing this blog, the petition currently sits at 37,250 signatures.
On 10th December 2020 the Government responded to the petition stating that the Stamp Duty holiday was only designed as a ‘temporary relief’ and therefore they do not plan to extend the relief beyond its current deadline. It certainly does not look likely that the stamp duty holiday will be extended, but with the new lockdown measures announced this week the Government’s position may now change.
In addition to the daunting prospect of the stamp duty holiday ending it was announced in November by the Housing Minister, Christopher Pincher that the current Help to Buy scheme will not be extended. For many still looking to get on the property ladder a looming question remains of what is going to happen after the end of the current scheme?
Although the Housing Minister announced an end to the current Help to Buy scheme this does not mean it is the end of Help to Buy. A new Help to Buy scheme will run for two years from 1st April 2021 to 31st March 2023. This new scheme will retain many familiar features of the existing one but will contain some slight changes.
The first change of the new Help to Buy scheme is that it will only apply to first time buyers. This is different to the current scheme which allowed applicants who were both a first-time buyer or those who have owned a property previously.
The second change of the new Help to Buy scheme is the introduction of price caps determined by the region of where the property is located. Under the current scheme there was a limit on the loan amount you could receive from Help to Buy. If the property you are purchasing is in London you are entitled to a loan up to 40% of the value of the property and if the property was outside of London you are entitled to 20%.
However, the Government have now added price caps on the property you can purchase in order to ensure a more proportionate amount is loaned. The following price caps have been announced per region:
| Region: | Price cap for Help to Buy: |
|---|---|
| North East | £186,100.00 |
| North West | £224,400.00 |
| Yorkshire and the Humber | £228,100.00 |
| East Midlands | £261,900.00 |
| West Midlands | £255,600.00 |
| East of England | £407,400.00 |
| London | £600,000.00 |
| South East | £437,600.00 |
| South West | £349,000.00 |
Despite these changes reducing the number of transactions involved in the Help to Buy scheme the window of opportunity to get on the property ladder has only increased.
The New Build conveyancing team at Lewis Denley are highly experienced in dealing with Help to Buy transactions and have an excellent relationship with key developers such as Barratt Homes and Berkeley Homes to name a few. Over the course of the past year the team has been successful in handling a sharp rise in New Build purchases using the Help to Buy scheme and are proud to have maintained our excellent levels of client satisfaction.
We provide experience along with a fresh innovative approach to ensure your first property purchase runs smoothly. If you are looking to take your first step in the property market using the Help to Buy scheme please get in touch with a member of our team.