To ask the Chancellor of the Exchequer, what steps his Department is taking to encourage home ownership.
24 June 2021
The Government is committed to helping people own their own home and has introduced a range of measures to help first time buyers, including those announced at Budget 2021.
The mortgage guarantee scheme announced at Budget 2021 and launched on 19 April 2021 is increasing the availability of mortgages for credit-worthy households who only have a 5 percent deposit, helping them realise their dream of homeownership. The scheme follows on from the successful 2013 Help to Buy: Mortgage Guarantee Scheme, and as of 8 June there are 192 mortgage products available for buyers with a 5% deposit, compared to only 5 in February 2021.
At Budget 2015, the Government announced the Help to Buy: ISA to support people saving up for their first home. Savers who opened an account before December 2019 are eligible to claim for a government bonus of up to £3000 towards the purchase of their first home. Since it launched in 2015, 508,492 bonuses have been paid through the scheme supporting 386,728 property completions across the UK.
Similarly, the Lifetime ISA (LISA) allows those under 40 to save either towards buying a home or for the long term. Like the Help to Buy: ISA, the Government provides a 25% bonus month on month, meaning that people who save the maximum will receive a £1,000 bonus each year. First-time buyers saving into a LISA can use their tax-free savings, including the government bonus, to buy a home up to the value of £450,000 anywhere in the UK, at any point after the account has been open for 12 months.
The nil rate band for Stamp Duty Land Tax (SDLT) has been temporarily increased to £500,000 and will reduce to £250,000 from 1 July 2021. However, from 1 July 2021, first time buyers purchasing properties up to £500,000 in value will get an additional relief, meaning they will pay no Stamp Duty on the first £300,000 and then only pay Stamp Duty at a rate of 5% on the remaining amount.