On the face of it, Budget 2000 has done very little for or to the housing market.
The proposed consultation process on the development of brown field sites seems interesting and in need of further investigation. In particular, I would like to know the measures that Gordon Brown would like to see to help bring about his vision of an urban renaissance. One proposal for consultation is that first purchasers of new property on brownfield sites could be exempt from stamp duty. The value of this would largely be felt in London and other cities where if could add up to as much as
4 per cent of a property's value.
The Chancellor did, as expected, increase stamp duty for properties at the top end of the market. For purchases of more than £250,000, stamp duty rises from 2.5 to 3 per cent and over £500,000 from 3.5 to 4 per cent. This will not have any real impact on the market as these price ranges represent no more than 3 per cent of transactions.
A benefit for those who use Isas to repay interest-only mortgages came with the unexpected one-year extension to the £7,000 limit that can be invested. Many borrowers could use this to take advantage that can be gained through higher early year investment on long-term mortgage interest savings.
Whatever your views on this Budget or this Government, you cannot take away from Gordon Brown the fact that he has delivered a stable economic and monetary environment where large fluctuations in interest rates are believed to be a thing of the past. To the ordinary borrower this should mean that if you can afford your mortgage today you will be able to afford your mortgage tommorrow.