Stamp Duty Holiday Helps Boost Home Sells
Stamp duty holiday has led to many first time buyers coming out to purchase their first home. The number of mortgage applications in January of this year was 25.8 per cent higher than in the same month last year according to the Mortgage Advice Bureau. House prices have fallen giving buyers good value for their purchase price and there has been a rise in the loan to value levels on mortgage products. The Bureau revealed that there had been a decrease in the deposit size in seven of 10 regions which shows that lenders wanted to take the opportunity to lend to those that wanted to beat the stamp duty.
Brian Murphy at Mortgage Advice Bureau remarked “More lenders have entered the high loan to value arena with further deals being offered at 90 per cent and even 95 per cent of a property’s purchase price or value.
“This is good news for prospective first time buyers and for those home movers with low levels of equity.”
The average loan value in January on purchase mortgage applications rose to £138,345. This is up from the £135,638 average recorded in December and the January 2011 average of £128,202. An increase in the housing market will be very much welcomed by those that have had to watch property values fall namely homeowners. Homeowners have been hit hard by falling property values as they have lost equity that could have been used to secure cash flow during a hard economic time or to secure the cheapest remortgage deal. Some homeowners have seen their property value decline below their mortgage debt leaving them in negative equity. It is hoped that the stamp duty holiday which is due to end in the middle of March will continue to bring out buyers to the housing market.