The Housing Market is Hot: Mortgages Have Bounced Back.

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May 20, 2021 - Kevin Dunn

The Housing Market is Hot: Mortgages Have Bounced Back.

The housing market has certainly turned hot, and the good news is that the mortgage market has bounced back to meet the surge in demand. First time buyers are creating a flow of movement in the housing market thanks to the launch of the Government’s mortgage guarantee scheme, which underwrites loans to those with 5 per cent deposits on homes worth up to £600,000. This has meant the housing chain is moving, and those looking for properties better suited to a working from home lifestyle are moving on and up.

The stamp duty holiday has also helped fuel the sudden demand for property. The deadline to complete property purchases in order to save on stamp duty costs is the 30th June 2021, with a tapering off of the offer until 31st September. This means those working in all aspects of the housing market have never been busier to meet these important deadlines.

So whilst finding a home to buy may be challenging, at least securing a good mortgage has become easier with more choice and availability of products. According to Moneyfacts, the number of 95% deals has tripled, with 112 mortgage deals needing 5% deposits at the start of May, and the number of available mortgage products is back to 75% of pre-pandemic levels. Across all mortgages, interest rates remain at an historical low, with rates as low as 1.27% fixed for five years for those with bigger deposits to put down.

Deals are sticking around for longer, too. In April the average shelf-life of a mortgage deal increased by 3 days to 32, meaning borrowers now have more time to secure their chosen product.

At Furnley House we are seeing that there is a high demand for mortgages. Buyers are eager to seize the moment while the stamp duty holiday is available. Recent data from the Bank of England shows that what we are experiencing is being reflected across the sector: net mortgage borrowing reached the highest level ever recorded in March.


When does the stamp duty holiday end?

The stamp duty holiday was introduced in July last year as a temporary measure to help boost homebuying during the pandemic. This meant that up until April 2021, there was no stamp duty to be paid on the first £500,000 of a property’s purchase price, if the property was being purchased as a main residence.

In the 2021 Budget, the Chancellor extended the date of the stamp duty holiday to 30 June 2021. After this date, and up to the end of September 2021, the stamp duty allowance is tapered down, meaning no stamp duty is due to be paid on the first £250,000 of a purchase price.

From 1 October 2021, stamp duty rates are due to return to normal tiers based on the property sale price:

£0 – £125,000 = 0%

£125,001 – £250,000 = 2%

£250,001 – £925,000 = 5%

£925,000 – £1,500,000 = 10%

£1,500,000+ = 12%

You can use the government’s Stamp Duty Land Tax (SDLT) calculator to find out how much you work out how much you would need to pay.


How do I get a mortgage?

If you are planning to buy a property and take advantage of the stamp duty holiday then you need to speak to a good mortgage adviser as soon as possible. Mortgage lenders are extremely busy and it is important that your application is processed without errors. You may also need the support of an adviser who can chase delays and answer questions with underwriters on your behalf to save time.

Our team of mortgage advisers and administrators at Furnley House are here to help. Our advisers will use their knowledge to provide you with comparison mortgage repayment quotes, as well as highlight any lender fees, legal or conveyancing fees and factor these in to the comparison figures. They will help you to find the best deal for your circumstances, and to meet your agreed purchase completion date.

To speak to one of our Furnley House advisers to talk about mortgages, call 0116 269 6311 to get a no-obligation quote, or email


Your home may be repossessed if you do not keep up repayments on your mortgage.