Bank of England make shock decision to lower the bank base rate to 0.25%
Before the newly appointed Chancellor Rishi Sunak had finished polishing his red brief case and stepped up to deliver his inaugural Budget speech, the Bank of England made a shock decision to lower the bank base rate by 0.5% from 0.75% to 0.25. The Bank said the rate cut was a reaction to the “economic shock” of Corona Virus which, has been confirmed as pandemic, By the World Health Organisation, and would “help to support business and consumer confidence at a difficult time, to bolster the cash flows of businesses and households, and to reduce the cost, and to improve the availability, of finance”. Major lenders Halifax, Barclays, Lloyds and Bank of Scotland have subsequently announced that they will pass the savings on to mortgage customers with effect from 1st April 2020.
Stamp Duty increase for non-UK residents
The Budget was primarily focused on mitigating the impact of the Corona Virus on the UK economy.
Chancellor Rishi Sunak announced a 2% increase on Stamp Duty for non-UK residents, which would be effective from April 2021.
It is estimated that the 2% increase will create annual tax revenues in excess of £100m, and will be used to tackle rough sleeping, buying up to 6,000 new places for people to live.
It is estimated that the 2% surcharge will affect 70,000 of the UK’s 1.2 million annual property transactions.
The Chancellor anticipates that the surcharge will help control house price inflation, and will support UK residents, in moving up The Property Ladder.
The build up to the Budget was full of speculation that the Chancellor would make radical changes to overhaul Stamp Duty to stimulate the housing market, however, the changes were solely focused on overseas investors.
The Affordable Homes Programme
Rishi Sunak announced that the affordable homes programme has been extended with a new multi-year settlement of £12bn. £1.1bn of allocations from the Housing Infrastructure will be used to fund up to 70,000 new homes in high demand areas in the UK, including Manchester, Sunderland and Lancaster.
Removing Unsafe Cladding
There will be an additional £1billion allocated towards the removal of unsafe combustible cladding, for residential properties, taller than 18 meters
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