Rishi Sunak, the Chancellor of the Chequer, delivered his first Budget Statement to the House of Commons earlier this month, outlining proposals for changes to taxations and included forecasts for the UK Economy. During this announcement, he also made several pledges to support the housing market, which we have summarised and provided a brief overview below.
Stamp Duty Surcharge non-UK Residents:
It was confirmed that a new stamp duty surcharge of 2% for non-UK residents buying a property in England and Northern Ireland will be introduced from 1 April 2021. This new stamp duty surcharge was initially outlined the Conservative Party’s 2019 General Election Manifesto.
What does is stamp duty surcharge mean of non-UK residents?
Properties that exchange after the 11th March 2020 will be impacted by the 2% surcharge if the property is due for completion after April 2021. However, regardless of when the completion date may be, if you exchanged on the property before 11th March 2020, the current understanding is that the new additional 2% surcharge will not be applicable. The UK Government is still yet to provide further guidance regarding this additional surcharge.
Grenfell Building Safety Fund:
The Chancellor also introduced a Grenfell building safety fund of almost £1bn, which will be used to remove ACM cladding from residential buildings taller than 18 metres. Further guidance regarding this is due to the published regarding how residents, leaseholders, or developers could access the funds etc.
The Affordable Homes Programme and the Housing Infrastructure Fund
A £12.2billion extension to The Affordable Homes Programme which will now run until 2025, was also pledged by the Chancellor. This programme was initially introduced in 2016 and was scheduled to end in 2021. In addition to this, the Housing Infrastructure Fund will also be allocated an additional £1.1billion to build almost 70,000 new homes in high-demand areas.
The Treasury Green Book review
The Chancellor announced plans to review the rulebook that government uses to appraise and evaluate spending decisions. This could create a significant geographical change in the distribution of funds, which have previously been heavily directed towards London and the south/east regions of the UK. In future, public investment will be set to deliver wider economic, environmental and social benefits across the country as a whole.
All the above measures outlined by Rishi Sunak are aimed to provide support and restore confidence to the UK housing market. If you are looking to make some changes to your investment portfolio or would like to find out more about how the 2020 Budget announcement may affect you, please contact our team at firstname.lastname@example.org.