Property & Mortgage Outlook – April 2021

The big announcement for the housing market in last month’s budget was a welcome extension to the SDLT holiday – see more below.

The second major announcement was a guarantee scheme for lenders offering 95% mortgages.

Activity levels picked up over February, with demand being consistently stronger than supply, supporting price growth.

Best Buys* (as of 30th March 2021)

Initial Rate Description Subsequent Rate Overall Cost For Comparison (APR) Early Repayment Charge Max Loan Fee
1.09% 2 Year Fix 3.35% 3.00% 3% Years 1 & 2 £1.5m £1,499
1.19% 3 Year Fix 3.59% 3.00% 3% Year 1; 2% Year 2; 1% Year 3 £1.0m £1,495
1.19% 5 Year Fix 3.59% 2.70% 5% Year 1, reducing to 1% Year 5 £1.0m £1,495
1.19% 2 Year Fix – BTL 4.74% 4.30% 3% Year 1, 2% Year 2 £1.5m 2%

Stamp Duty Deadline Extended

The chancellor, Rishi Sunak, provided a boost to the UK housing market by extending the stamp duty holiday until the 30th June 2021 and then tapering until the 30th September 2021. Although tight, there is still time to beat the deadline. With help from our mortgage partners, we can ensure a fully packaged mortgage application is processed and approved in days and choose lenders who will accept search indemnity insurance to avoid legal delays.

Large Loans

Many lenders have tightened their criteria and Clients often find their existing banks either unable to assist or uncompetitive for loans over £1,000,000. There are a number of mainstream, specialist lenders and private banks who are comfortable with large loans so we are often able to arrange market leading rates on an interest only basis for high-net-worth individuals.

Top Slicing For ‘Buy To Let’

Many banks have dramatically reduced the maximum borrowing available on ‘buy to let’ which usually affects high value properties where yields tend to be a little lower. We have lenders who will allow Clients to ‘top slice’ where income is used to top up any shortfall in rent to achieve the level of borrowing required. Many higher rate taxpayers are now choosing to purchase their investment properties via a Special Purpose Vehicle (SPF).

Whether you are coming to the end of your mortgage product or keen to compare your current rate to the best available elsewhere, please contact your adviser who can put you in touch with our mortgage partners.

* Lending criteria restrictions apply to all products, always seek independent advice.

Articles on this website are offered only for general information and educational purposes. They are not offered as, and do not constitute, financial advice. You should not act or rely on any information contained in this website without first seeking advice from a professional.

Past performance is not a guide to future performance and may not be repeated. Capital is at risk; investments and the income from them can fall as well as rise and investors may not get back the amounts originally invested.

Your home may be repossessed if you do not keep up with payments on your mortgage.

You are now departing from the regulatory site of Finura. Finura is not responsible for the accuracy of the information contained within the linked site.

Source: Professional Mortgage Services.

Other News

A fair start to 2021

Global markets got off to a steady start in 2021 after the volatility of 2020.

Incorporation and 25 percent corporation tax

The advent of 25% corporation tax could make incorporation a less attractive option.

The new 130 percent super-deduction: how will it work?

The Government has published new guidance on the 130% super-deduction capital allowance, the 50% first-year allowance for qualifying special rate assets, and the new Enhanced Capital Allowances for Freeports.