The current stamp duty holiday for first time buyers is due to come to an end on 24 March 2012. Based on the average first time buyer property of £140,000, borrowers taking their first step onto the housing ladder would need to find an additional £1,400.
The £1,000 cash back offer is available for a limited time to first time buyers who hold or open a FlexAccount as their main current account and reserve a mortgage from Nationwide's range of two, three and five year fixed rate products from 05 March 2012.
On top of this, first time buyers saving for at least six months in the Society's Save to Buy account can earn up to an additional £1,000 cash back, therefore giving qualifying borrowers up to £2,000.
‘The loss of the stamp duty holiday has been a blow for first time buyers as they now potentially have to save more than a thousand pounds on top of a deposit. Nationwide is committed to doing what we can to help support this important part of the market,’ said Martyn Dyson, Nationwide's head of Mortgages.
‘The Society already offers a £500 discount on product fees and our unique Save to Buy savings account which enables savers to qualify to apply for a mortgage with just a 5% deposit. Add to this to our new cash back offer and it shows we are really are doing more for first time buyers,’ he added.
The launch of Nationwide's new stamp duty cash back offer gives first time buyers some much needed help as the government's stamp duty holiday ends at the end of March, says uSwitch.com, the independent price comparison and switching service.
‘Nationwide's offer could prove a lifeline for thousands of first time buyers who have yet to secure a mortgage or find a suitable home. With no promise as yet from the Government to extend the stamp duty holiday, Nationwide has nipped in with this offer which will lend first time buyers a much needed helping hand,’ said Michael Ossei, personal finance expert at uSwitch.
‘First time buyers are facing a squeeze as well as the looming prospect of having to pay stamp duty after March, they are also starting to be hit by rising fees. While mortgage rates have fallen over the last 12 months, with the average fixed rate mortgage for first time buyers dropping from 4.99% a year ago to 4.4% today, mortgage fees have increased. Over the same 12 month period, the average fee has increased from £1,101 to £1,300, making it harder for first time buyers to get their foot on the housing ladder,’ he explained.
‘Nationwide seems to understand the pain and expense of buying a home for the first time. This new deal beats other cash back offers currently available from Santander and the Post Office, which are giving cash back of £250 and £300 respectively. However, the Post Office deal also offers free valuation, which will also appeal to first time buyers,’ he pointed out.
‘But what Nationwide has also done is to create a complimentary product range through its Flexi account that could appeal to home buyers. In particular, it has a very competitive purchase credit card for 18 months at 0% which could be very helpful for additional moving expenses,’ he added.
