London-based estate agents were among those to benefit from a rush of first-time buyers trying to beat the end of a stamp duty holiday.
The number of mortgages awarded to first-time buyers in March went up by 74 per cent, according to the Council of Mortgage Lenders (CML). Borrowers new to the market took out 24,000 loans worth a total of £3bn in March.
The volume of lending went up by 74 per cent on February and 57 per cent on March last year as the concession, which exempted first-time buyers from the one per cent stamp duty on homes worth less than £250,000, came to a close on March 24.
Mortgages for properties outside of the stamp duty concession also increased due to properties being in chains. Home movers took out £4.3bn across 27,200 loans in March, a rise of 25 per cent on February’s figures.
Harrow-based Infinity Property Solutions managing director Kamlesh Padhra said the stamp duty holiday was an effective way of boosting the property market.
“Yes there has been an increase in transactions from an estate agent’s point of view.
“Last year, come October, November and December our office’s trade took a drop, but by February, March and April we saw a surge where we have been completing and clients have been getting mortgages with relative ease.”
Padhra was unconvinced that the government’s NewBuy scheme, which assists people who have a deposit of at least five per cent in buying a new home, would fill the void left by the concession.
“NewBuy is not the answer at the moment,” he said. “The government should bring the stamp duty down again and ease up on first-time buyers especially, it did help with transactions.”
Padhra’s scepticism over the NewBuy scheme was echoed by Rogue Property Ltd director David Freeman. When asked if the scheme would help the property market, Freeman said: “I doubt it.”
Freeman continued: “I don’t feel the government are doing much to help because lending is tight. If they could persuade the banks to lend to people it would be a lot easier and there would be more people who are able to get mortgages.”
Despite the stamp duty holiday coming to an end, Freeman said business had been “pretty consistent” since March, while trade was strong among people with bigger budgets.
“The higher end of the market is still buoyant, with properties around the £700,000 mark there are a lot of people with cash looking to buy,” he said.
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