Mortgages with 1% deposit on way?

Posted: 25/1/2024

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The government is expected to introduce 1% deposits on mortgages in the March budget. It is understood that they are considering guaranteeing an element of 99% mortgages to help first time buyers who are struggling to afford a deposit on a home. Ironically it is the present government who have created the problem, as their policy of increasing costs to landlords have contributed to rents sky rocketing, leaving tenants who are trying to save a deposit for a new home struggling to do so. 

However, it is not clear if the policy will extend to Northern Ireland where housing is devolved. 

So what effect would this likely have on property values? In theory it should mean more buyers, so that could drive up house prices. But if there is a noticeable take up of renters buying their first property, that could ease the pressure on rental demand and level off rent prices. Of course, also in theory, good prices could encourage landlords to sell, reducing the rental supply.

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