Yesterday the Chancellor announced his highly anticipated Spring Budget following what has been one of the most difficult economic periods since wartime.
He announced a range of changes that will affect the property market across the UK and in Scotland including a new government-backed mortgage guarantee scheme and an extension of the stamp duty holiday.
Mortgage Guarantee Scheme
The government has announced that a 95 per cent loan to value (LTV) mortgage guarantee scheme is being introduced to help buyers with small deposits get onto the property ladder. The scheme will launch in April and home. Buyers will be able to purchase a home worth up to £600,000 with a 5% deposit. It is hoped that the scheme will encourage lenders to reintroduce low-deposit mortgages as they have been largely withdrawn. This scheme is open to all buyers, not just first-time-buyers.
Stamp duty
The temporary stamp duty holiday in England, Northern Ireland, Wales (LTT) and Scotland (LBTT) was announced last summer. This has now been extended by three months in England, Wales and Northern Ireland. This news is a relief to home buyers and sellers who have been desperately trying to complete their property purchase in time to meet the 31st March deadline. With current delays this has given many of these a lifeline and prevented many sales falling through. At present there are an estimated 628,000 sales still in the legal process across Great Britain, including those that were agreed last year and those that have been agreed so far this year.
In Scotland, as of today March 4th, buyers who are in the middle of property transactions are set to lose out on a significant tax break after the decision not to extend it beyond the end of the month. Finance Secretary, Kate Forbes, has said that the cut to stamp duty would not be replicated for the Scottish Land and Building Transaction Tax (LBTT). The temporary reduction to LBTT will end as planned at the end of this month.