Update on the Autumn Statement

28 February 2024

The Autumn Statement was delivered by Chancellor of the Exchequer, Jeremy Hunt, on 22 November last year. While there was a host of announcements on measures for business and personal taxation, housing was largely absent. There are, however, a few points to be aware of.

Extension of mortgage guarantee scheme

This scheme was introduced in March 2021 when mortgages with a higher loan-to-value (LTV) ratio were depleting. The aim was to give lenders the confidence to keep offering higher LTV mortgages so more first-time buyers (FTB) could get on the property ladder. The scheme enables borrowers with smaller deposits to take out a mortgage with a 5% deposit on a home worth up to £600,000. The government gives the mortgage lender a guarantee of up to 15% if the borrower defaults on their repayments.

The scheme was due to end in December 2023, but it will be extended by 18 months until the end of June 2025. It is available to those buying a home they plan to live in using a repayment mortgage. It does not apply to buy-to-let investments, or to those purchasing a holiday home or second home. Only loans set at a maximum of 4.5 times income qualify for the scheme.

Change in permitted development rights

The Chancellor also announced a consultation into scrapping planning permission for property owners wishing to convert one house into two flats. It will only be permitted in cases where the exterior of the home does not change. This could be good news for property investors and the private rented sector, which is currently trying to keep up with the ongoing demand for rental accommodation.

Housing and planning investment

During the Statement, a further £32m was pledged towards the development of thousands of homes across the country, including funding to tackle planning backlogs in Local Planning Authorities (LPA).

🚨 Data accurate as of the date of publication – 28.02.2024

🚨Think carefully before securing debts against your home.  Your home may be repossessed if you do not keep up repayments on your mortgage.

🚨 The above material is for informational purposes only and does not constitute a sales offer or financial advice. Before taking out any insurance, credit agreement or other financial product, you should obtain individual advice on your requirements and the general terms of the contract.

 

Na podstawie: Quilter Financial Planning – Essentially Mortgages Q1 2024

 

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