What is happening with interest rates, mortgage deals and stamp duty in Edmonton?

If you are a homeowner looking at moving, you’ll know there’s a lot of news coverage about interest rates and mortgage loans right now, which can affect the sale of your home, along with your own purchase as people consider their options for when they look to remortgage in the future.

Now I don't have a crystal ball, however there’s a suggestion from the financial markets that the bank base rate could rise to 3.25% early next year. This has impacted the underlying costs of fixed-rate mortgages. This is why some lenders have repriced deals, and why some are now opting for a longer-term fixed rate or rushing to secure the product they have been offered. 

Remortgaging?

If you’re among the estimated 15% of borrowers with a variable or a tracker mortgage, your monthly outgoings will almost certainly go up, so you could shop around to see if you can find a cheaper option with a fixed-rate mortgage. However, you might have to pay an early repayment charge first.

If your fixed-rate deal is due to end within the next six months, you can also see what your options are for locking in a deal now.

Many lenders will allow existing customers to apply for new deals up to six months before their current rate ends without having to pay an early repayment charge. This is often called ‘product transfer’ or ‘switching’ and is a relatively easy process.

For any advice on your mortgage options, please contact me and I will be happy to put you in touch with our expert Mortgage Advisor.

Stamp Duty

Chancellor Kwasi Kwarteng’s ‘mini-budget’ on 23rd September announced permanent stamp duty cuts for some home-buyers.

Previously, you would pay stamp duty tax on a home, or the portion of a home, priced between £125,001 and £250,000. Following the announcement, no stamp duty is payable below the price threshold of £250,000.

This means 17% of homes currently for sale area are now completely exempt from stamp duty in Edmonton N18 & N9.

Before the mini-budget announcement, first-time buyers paid no stamp duty on the first £300,000 of a home purchase. This has now been raised to £425,000, and if the home you’re buying is priced below £625,000, you’ll still pay no stamp duty on the portion of the property priced below £425,000, and 5% on the portion priced above this. This is an increase of £125,000 on the previous price cap of £500,000.

These changes reduce stamp duty bills across the board for all home-movers by up to £2,500, and by up to £11,250 for first-time buyers.

This also means 60% of homes currently on the market in Edmonton are now exempt from stamp duty for first-time buyers, compared to 29% when the threshold was £300,000.

Stamp duty rates for those buying second homes or buy-to-let properties when they already own a property elsewhere will continue to have a 3% surcharge.

If you have any questions about your property, move or local market, please feel free to contact me.

Until next time.
Thomas
tom@gracechurch-property.co.uk