What mortgage holders want from the Chancellor’s Autumn Statement

Home » What mortgage holders want from the Chancellor’s Autumn Statement Published: 21st November 2023 This Article was Written by: Adrian Anderson   autumn statement , mortgage guarantee scheme , stamp duty , tax

Given the UK’s tough economic conditions and recent reports of stagnant growth, it’s not surprising there has been intense speculation ahead of Wednesday’s Autumn Statement.

Hints over the weekend allude to the Chancellor’s keenness to reboot economic growth. As property finance specialists, the Anderson Harris team firmly believes that the property sector can be a key contributor to economic growth. From talking with our clients, here are the measures they desperately seek from the Autumn Statement, given the difficulties they face.

1. Extend the mortgage guarantee scheme for another year

The mortgage guarantee scheme enables lenders to offer up to 95% loans on properties up to £600,000. With first-time buyers increasingly active in the market, supporting the availability of high LTV mortgage products is important.

With rental prices at record levels and reducing affordable rental stock, the mortgage guarantee scheme has given banks the confidence to offer high LTV mortgages. The scheme was introduced in April 2021 and extended in January 2023, but it is due to come to an end this December.

2. Reduce Stamp Duty Land Tax across all residential property thresholds

After a year of raised interest rates to curb inflation, much of the middle and downsizing markets remain stagnant. Next-time buyers in the mid-market can no longer afford the additional cost of stamp duty on top of their property purchase. With the mid-market pausing their next move, downsizers are short of buyers and stuck in properties they desperately want to sell.

A welcome move called for by many of our clients would be for the Chancellor to reduce the stamp duty percentages across all residential property tiers to free up the market again.

3. Rethink Mortgage Interest Tax Relief

The buy-to-let sector has been targeted by the Government for almost a decade. A conveyor belt of measures has sought to dissuade people from investing in rental properties. It’s not surprising then that a shortage of rental stock from the exodus of landlords, exacerbated by high interest rates, has pushed rental prices to record levels.

With more landlords anticipated to exit the market in the coming year, and few incentives to attract them in, our landlord clients urge the Government to rethink mortgage interest tax relief and consider reinstating it. Encouraging landlords to stay or enter the market will deliver a more highly demanded rental supply, curb price rises, and thus reduce pressure on tenants.

Do contact our team of specialists.

For further help with property finance issues or to discuss how the Autumn Statement’s announcements will affect your mortgage, contact us on +44 (0) 20 7495 6633 or e: enquiries@andersonharris.co.uk.