For anyone who hasn’t already heard the news, Boris Johnson has announced a plan to bring forward proposals to introduce long term, fixed rate mortgages, which will enable first-time buyers to purchase their first homes with 95% mortgages – only requiring a 5% deposit!
The Prime Minister has claimed that doing this will add two million new home owners to the housing market, which will in turn fulfil one of his party key manifesto promises from 2019.
The sad truth is that in recent years the number of home owners in this country has plummeted, the problem not lying with a failure to afford or be granted a mortgage agreement, but with an inability to produce deposits significantly higher than 5%.
This has pushed many people into renting, unable to make their home ‘their own’ and swiftly losing money that they could be putting into their own mortgage (as opposed to paying someone else’s).
If this new proposal takes off we could, according to a source, be seeing the largest expansion of home ownership since the 1980’s, with apparently two million more property owners in the country.
How Will This Impact The Property Market?
If the plan goes ahead then massively!
Access to 95% mortgages, means that a large percentage of first time buyers who have been saving every penny in order to achieve a deposit big enough to buy, can do so potentially a lot sooner than they initially thought, which will in turn, see a huge shift forward in the amount of properties being sold nationwide.
First time buyers are also particularly attractive to vendors as they are chain free, meaning that in most cases, there will be less complications and less things to go wrong further down the sale process.
For this reason, the Esale team have every intention of stocking up on coffee, as we’re quite possibly going to have a very busy few months ahead!
For more information following this announcement, or to learn more about putting your property on the market with us then get in touch, our friendly team are always happy to help!
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