Mortgage Searches Increase Due To Stamp Duty Holiday


The recent stamp duty holiday has already affected buyer behaviour, and many housing specialists believe there will be a greater level of activity in the market. One industry source believes there will be an additional 100,000 houses sold because of the savings on offer to buyers.

It stands to reason that if more people are looking for homes, there is also an increase in people applying for mortgages.

The Experian Marketplace mortgage comparison site has experienced a 29% increase in searches, in the wake of the stamp duty changes.

The stamp duty holiday has encouraged buyers to act

On Wednesday 8th July, the Chancellor of the Exchequer, Rishi Sunak, has announced an increase in the stamp duty threshold in the Summer Update. The key points of the stamp duty changes are:

  • Stamp duty threshold is now £500,000
  • This increase in stamp duty threshold is set to run until 31st March 2021
  • The increase in stamp duty threshold takes place immediately

Amir Goshtai is the Managing Director of Experian Marketplace, and he said; “Since the chancellor’s announcement of a stamp duty holiday, we’ve seen a surge in people searching for mortgages, demonstrating its immediate impact.”

Amir continued by saying; “Mortgage product availability is starting to grow to meet this demand, as lenders reintroduce products back to market, including higher loan to value ranges. The announcement should also help more people qualify for these products as the stamp duty holiday enables them to provide a larger deposit.”

Some experts believe the boost will be short-lived

Not everyone is confident that the initial burst of activity in the housing market after lockdown will lead to a long-term impact.

Andrew Southern is the Chairman of property developer Southern Grove, and he said; “The annual decline isn’t particularly flattering but it’s the trajectory that’s most important. The next few months are going to make June look like an amuse-bouche rather than an entrée. A healthy improvement in volumes month on month points to a large proportion of agreed sales that were knocked back due to the pandemic finally reaching completion. However, those who only began seriously looking in late May won’t necessarily feature in these figures for months yet.”

Other factors shape housing market and demand for mortgages

An issue that is likely to impact the housing and mortgage markets in the future is an increase in divorce enquiries. Information provided by Co-Op Legal Services in June 2020 indicated divorce enquiries increased by close to 40% since the beginning of lockdown.

James Forrester is a Managing Director of Barrows & Forrester estate agents and he spoke to City A.M., saying; “We are seeing a spike without a shadow of a doubt, and we’re starting to see that boost of stock come through. It’s just unfortunate we’re seeing the boost from people deciding they no longer want to be together.”

While it is sad to see relationships ending, especially if the challenging circumstances of the lockdown period has exacerbated issues, it is important the housing and mortgage sector are aware of this new demand for services.

There is still considerable uncertainty in the mortgages market, but it is easy to see why many industry professionals believe the market will be busy.

While there are new challenges to overcome in the housing market, people shouldn’t consider arranging a mortgage to be an impossible task. However, it is vital people accept help and assistance from professionals in the field. If you are keen to arrange a mortgage, speak to a mortgage broker or experienced adviser and make sure you are fully equipped to make an informed decision.

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