Reasons for Property Owners and Investors to feel good.

The recent budget contained some good news for property owners and purchasers.


The ‘stamp duty holiday’ for properties in England and Northern Ireland has been extended from its proposed end date of 31st March to 30th June 2021. During this time there will be no basic stamp duty on residential property purchases in England and Northern Ireland of up to £500,000 (although the added stamp duty, currently 3%, for second homes and let properties will continue). After 30 June, the starting point for stamp duty will reduce to £250,000 until 30 September, when it will return to its previous level of £125,000.


This provides a further opportunity to save costs on property purchases in England and Northern Ireland in the near future.


Scotland and Wales have their own equivalent to stamp duty with different rates. No change to the existing arrangements has been announced by the Scottish government so the 31st March deadline remains if that is where your property is located. But the Welsh government has confirmed that the increase of the Nil band of Land Transaction Tax to £250,000 will continue to 30th June for properties in Wales.


A return to 95% residential mortgages has also been announced in the form of a new Mortgage Guarantee Scheme, with the government incentivising lenders by providing guarantees for loans above 90%.


Add to the above the easing of planning reforms already in place or proposed which, for example, enable the building of a two-storey extension to a residential home without the need for planning permission and there are plenty of reasons for property owners and investors to feel confident about the future.

Green Homes Grant for Homeowners and Landlords

One of my earlier posts referenced the Green Homes Grant whereby Homeowners and Residential Landlords in England can apply for a Green Homes Grant voucher towards the cost of installing energy efficient improvements to their properties. Rules apply, but  under the scheme the Government will potentially contribute up to £5,000 to cover two-thirds of the cost of eligible improvements, with the property owner contributing the remaining third.

One of the Buy to Let lenders on our panel has now announced specific Green Further Advance products designed to assist buy-to-let landlords who are looking to improve the energy performance of their properties by taking advantage of the Government’s Green Homes Grant Scheme.  The green further advance products are available for properties in England, with rates starting from 3.35% and with no application fees, no product fees and a free mortgage valuation.

Please enquire for further details.

Leaseholders to be given right to extend lease by 990 years at zero rent

The UK government announced today that it plans to pass legislation giving the right to leaseholders to extend their lease by 990 years at zero ground rent.

This will apply to both leasehold houses and flats and the government estimates it will benefit some 4.5m leaseholders.

Housing secretary Robert Jenrick said: “Across the country people are struggling to realise the dream of owning their own home but find the reality of being a leaseholder far too bureaucratic, burdensome and expensive.

“We want to reinforce the security that home ownership brings by changing forever the way we own homes and end some of the worst practices faced by homeowners.

“These reforms provide fairness for 4.5m leaseholders and chart a course to a new system altogether.”

Under current rules, leaseholders of houses can only extend their lease once for 50 years with a ground rent. This compares to leaseholders of flats who can extend as often as they wish at a zero ‘peppercorn’ ground rent for 90 years.

In a report in July the Law Commission said there was “no reason” for leaseholders’ rights to diverge, and recommended a uniform right to extend a lease for all qualifying leaseholders.

Under the proposed new rules both house and flat leaseholders will be able to extend their lease to a new standard 990 years (meaning effectively a lease need only be extended once) with a ground rent at zero.

Further proposals include ground rents being reduced to zero on all retirement properties and the scrapping of ‘marriage value’ – the supposed value of joining up leasehold with freehold.

Owners of leasehold property will welcome the news, but may have to bide their time as experts warned the changes required to legislation will be complex and may not come to fruition for over a year.

Leasehold tenure is already banned on new build houses, and does not exist at all in Scotland. The Law Commission recommended last year that leasehold should be replaced with commonhold tenure on new homes, whereby ownership and management of land and buildings belongs jointly to the residents of a shared block. Commonhold has been permitted in the UK since 2002 but has often faced legal hurdles – now it is proposed to set up a ‘Commonhold Council’ made up of leaseholder groups, industry and the government, to prepare for a wider take up of commonhold and ‘in due course’ further legislation to implement fully the Law Commission’s recommendations.

Covid-19 Further UK Lockdown

Messages we are receiving from lender contacts all emphasise they are open for business, and mortgages for purchase and remortgage purposes can continue as normal.

Mortgages for Older borrowers

One of our building society contacts reminds us that they have residential mortgage products for older applicants including

  • Repayment and interest only
  • Repayment plan may be downsizing (or not, as the case may be)
  • Applicants up to age 85

All subject to criteria of course, but possibly better than equity release for some people.

Stamp Duty Land Tax Incentive

On 8th of July 2020 the Chancellor announced a Stamp Duty Land Tax Incentive (a Stamp Duty ‘Holiday’ on the first £500k of the purchase price) on all residential property until 31st of March 2021.

Although, at the time of writing the deadline is still 4 months away we recommend anyone hoping take advantage to act soon and to bear in mind some things may delay a speedy completion of your purchase. ibmco will of course do all it can to expedite mortgage applications and avoid delays from lenders but the below are largely outside our control, hence the advice not to leave your purchase to the last minute:

  • Valuations may be slower than normal at present
  • Solicitors offices are affected by Coronavirus rules and with many solicitors working from home their service may not be as efficient as normal
  • Local land registry searches can hold up the process. There is a big variation in turnaround times depending where your property is. To check current times for your area you can use the following website:

Of course there is also likely to be a ‘log-jam’ of purchases jostling for completion as 31st March 2021 approaches.

Finance for Holiday Lets

Amid continuing interest in the Holiday Let market, we received a reminder today from one of our Building Society contacts of their appetite for Holiday Let mortgages, including properties to be occupied by the borrower for part of the year let for the remainder. Air BnBs and applications from ex-pats are also considered for Holiday Let applications.

Green Homes Grant for Homeowners and Landlords

Homeowners and Residential Landlords in England can now apply for a Green Homes Grant voucher towards the cost of installing energy efficient improvements to their properties. Rules apply, but  under the scheme the Government will potentially contribute up to £5,000 to cover two-thirds of the cost of eligible improvements, with the property owner contributing the remaining third. Vouchers must be redeemed and improvements completed by 31 March 2022.

10 year fixes for Buy to Let Mortgages

Buy to let property investors who want the peace of mind of a ten-year fixed rate mortgage can bring amid fears over the economy and Brexit uncertainty now have several options.

Virgin Money have launched a fresh selection of ten-year fixed rate buy to let mortgages with rates starting from 2.46 per cent up to 60 per cent loan to value (LTV) with a £1,995 fee and 3.99 per cent up to 75 per cent LTV with no product fee. Virgin are the only lender currently offering up to 75% LTV on a fix of this term.

Meanwhile, Leeds Building Society has also launched a range of ten-year fixed rate buy to let products.

Products start from 2.49 per cent up to 60 per cent LTV and 3.29 per cent up to 70 per cent LTV. Both products have a £999 product fee and come with a free standard valuation and fees assisted legal services.

The Mortgage Works also has 10 year fixed products (rates from 2.74%) but with a maximum of 65% LTV. However one of their products, whilst at a fixed interest rate of 3.24% for 10 years, has no early repayment charges after 5 years. TMW’s 10 year fixes have £1,995 product fee and offer free standard valuations and cashback.

Virgin Money is also offering a new seven-year fix rate deal from 2.36 per cent at 60 per cent LTV with a £1,995 product fee, as well as a 3.24 per cent seven year fix at up to 75 per cent LTV with a £995 fee.

Zephyr Homeloans

Zephyr Homeloans, a relatively new Buy to Let specialist lender, announced reduced interest rates across its product range. Highlights include:

  • Rates from 2.49%
  • New 7 Yr. Fixed Rates available from 3.30%
  • 5 Yr fixed rental stress from 125% at pay rate
  • Maximum age 95 at completion of mortgage
  • HMO’s to 6 bedrooms
  • MUFB’s up to 6 units
  • Unlimited background portfolio
  • Flats above commercial considered

Residential Mortgages for Landlords from Paragon Mortgages

Paragon Mortgages have introduced a range of Residential Mortgages aimed at landlords who are

  • Seeking an owner occupied mortgage
  • Self Employed
  • Have complex income arrangements
  • Looking to borrow into retirement
  • Require interest only terms

Fixed rates start at 3.45%

Please contact Pav or David for more information.

Cashback from Keystone Mortgages

Keystone Mortgages have introduced a cashback offer on their entire Buy to Let mortgage range – both purchases and remortgages. Cashback will be £750 on loans up to £250,000, and  £1,250 on loans between £250,001 and £1m. Available on standard and specialist mortgage ranges for both individuals and limited companies. Contact David or Pav for further information.

Hampshire Trust increases minimum loan to £200k

In announcing an increase in the minimum loan amount from £100k to £200k, Hampshire Trust remarked ‘We continue to expand and diversify our products and proposition and are the lender you can rely on for genuinely specialist funding solutions. As a reminder, we currently lend on complex requirements including portfolio landlords, holiday lets, HMOs, semi-commercial, serviced accommodation, sitting tenants, new build flats and purpose-built student accommodation. We also lend to foreign nationals, expats as well as trust and offshore borrowers’. ibmco welcomes enquiries in these specialised fields as well as more straightforward residential and Buy to Let mortgages.

5 year fix with 3 year tie-ins – is this a new trend?

The flexibility for Buy to Let mortgage borrowers of being able to fix an interest rate for 5 years whilst only having early repayment penalties for 3 years is to be welcomed. But does the fact that 3 lenders now offer such products suggest this may be more than a passing marketing ploy? Precise Mortgages, The Mortgage Lender and Foundation Homeloans all have 5 year fixes with 3 year tie-ins including products for individuals and limited companies, and products for standard, HMO and multi-unit properties. Enquiries welcomed.

One Savings Bank and Chartercourt Financial to merge

One Savings Bank Group and Chartercourt Financial Group have agreed to a merger it has been announced. The transaction now requires approvals by shareholders and regulators before it becomes final. One Savings Bank includes well-known Buy to Let and Residential mortgage lender Kent Reliance as well as Commercial and Semi-commercial lender Interbay, while Chartercourt will be best known for its Precise Mortgages Buy to Let mortgage brand.