Due to the increased demand on the property market since it opened back up again, coupled with increased economic uncertainty, many lenders have tightened things up when it comes to the deals on offer. Unfortunately, it’s first-time buyers that this is affecting the most it seems. With around seven out of ten borrowers looking to buy their first home being priced out of the property market.
Increasing interest rates are becoming more and more prevalent on many new home loans, as the market struggles to cope with surging demand for borrowers. It seems certain lenders are putting up rates in an effort to deter some potential borrowers, as coronavirus continues to limit their capacity to process applications.
Borrowers are being encouraged to act quickly due to the average rates on 2 and 5 year fixed mortgage deals rising for the fourth consecutive month. This has resulted in the average 2 year rate for borrowers with a 15% deposit now being over 3%.
With a second lockdown here, it’s no surprise that the mortgage market will continue to be significantly affected. The pandemic has of course already had an impact. However, Housing Secretary Robert Jenrick has confirmed that even though we’re heading into another national lockdown, the market will remain open…
It was predicted that around 90% of homebuyers would benefit from the 0% stamp duty scheme put forward by Chancellor Rishi Sunak. The threshold at which stamp duty kicks was raised to £500k compared to the previous £125k threshold.
However, many buyers are now facing a huge problem of potentially missing out on the stamp duty holiday all together, due to delays in getting purchases over the line.
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