Stamp duty holiday: Bishop's Stortford estate agent Savills happy with Chancellor's property market measures
A Bishop's Stortford estate agent has welcomed the Chancellor's Budget as good news for the property market.
Rishi Sunak confirmed on Wednesday (Mar 3) an extension to the stamp duty holiday. It had been due to finish at the end of this month, but to avoid purchases not completing in time, he announced that the £500,000 nil rate band would continue until June 30 before tapering down to £250,000 for three more months and returning to £125,000 from October 1.
The Chancellor also unveiled a new mortgage guarantee scheme for homebuyers. From April, lenders who commit to providing loan-to-value ratios of 91% to 95% can get a Government guarantee on the full value of those mortgages.
At Savills in North Street, Justin Godfrey, director of the residential team, said: "The stamp duty holiday extension is the news the housing market had hoped for. It will allow record levels of 'under offer' stock to complete without the pressure of the March 31 deadline and bring badly-needed stock to the market.
"We know from our client surveys that many buyers in the prime markets made their decision to move before the stamp duty holiday was announced and we expected the majority of sales to complete whether or not they made the deadline.
"We also know that the stamp duty saving had most benefited sales in the £400,000 to £600,000 bracket, so this extension will likely be most keenly felt in the mainstream market. That said, what is good news for the mainstream market is definitely good news for prime, with positive sentiment carrying between the two."
Lawrence Bowles, a director in the Savills research team, said: "We estimate the mortgage guarantee will have a limited direct impact on transaction activity and pricing.
"However, guaranteeing mortgages sends a powerful message to the market about Government's support for home ownership and for the housing market as a whole. This will help maintain strong consumer confidence and help support house prices.
"It also recognises the importance of the housing market to the economy as a whole, particularly as it is not limited to first-time buyers but extends support to upsizers, for example, young families requiring additional space."