What will the 95% mortgage scheme mean for the property market?


The Chancellor’s Budget included several announcements that will provide a boost to the property market. The first was the much anticipated extension of the stamp duty holiday, which will now run until the 30th June, with many buyers breathing a sigh of relief.

The introduction of the Government’s 95% mortgage scheme is also welcome news for would be home buyers who are trying to get on to the property ladder.

How will the 95% mortgage scheme work?

Launching in April 2021, the scheme will enable first-time buyers and existing homeowners to purchase properties up to £600,000 with a 5% deposit. Several of the UK’s largest lenders have confirmed they will offer 95% mortgages including; HSBC, Lloyds and NatWest.

Over the past year there was a significant drop in the number of 95% loan-to-value mortgages (LTV) available in the UK. In March 2020 there were 391 available compared to just five a year later.

The scheme starts next month and will run until the end of 2022. The initiative aims to encourage banks and building societies to offer more 95% mortgages again, with the government guaranteeing part of the borrowing should the buyer run into financial difficulty.

Who can apply?

Both first time buyers and existing homeowners can take advantage of the 95% mortgages, but the property has to cost £600,000 or less. It also can’t be used for second homes or buy-to-lets.

It’s worth keeping in mind that mortgage lenders will still calculate their lending based on household income and buyers will still be subject to the usual credit checks.

Thinking of buying a property?

Our experienced Chartered Surveyors can carry out a full structural building survey on your chosen property.

Following a thorough inspection of all accessible areas of the property, you will receive a comprehensive report that comments on all aspects of the property’s general condition and highlights whether there is any evidence of structural movement, both historic and active, timber defects, and issues relating to dampness.

We can also advise on and answer any specific queries you have regarding construction, extension, alterations or repairs you may want to make to the property.

Reports are turned around within five to seven days of inspection and you will be able to talk directly to the surveyor working on your behalf should you have any questions when you receive your report.

For homeowners looking for a sellers valuation or purchasers looking for a pre-purchase valuation, we can conduct these inspections at the same time as our building survey. This will save time and provide a cost saving to you compared to when both reports are conducted separately. Our valuation will provide you with essential information that gives you the best chance of paying a fair purchase price for your home or property.

How much does it cost?

You can typically expect to pay a fixed fee between £750 and £1200 + VAT for a straight forward residential building survey but larger or more complex properties will cost more and the exact cost will depend on a number of factors including the size and age of the property.

Thinking of selling?

Our team of experienced Chartered Surveyors can assist you with a pre-sale valuation. They can determine the value of your property in the current market place, and work in accordance with the RICS Red book standards.

We assess all kinds of residential and commercial property including development land, houses and flats, including those of non-standard construction to provide our considered opinion of its value.

We will provide a detailed, evidence based report that provides our opinion of the value of the property in question and our aim is to assist you in making an informed financial decision relating to your property. Our valuation will give you essential information that gives you the best chance of receiving a fair sale price for your home.

Get in touch

We have an experienced team of RICS registered valuers who can provide a building survey, pre-sale valuation or pre-purchase valuation for any property. Contact us to discuss your individual needs.

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