STAMP DUTY HOLIDAY CONFIRMED

Stamp duty will be abolished for nine out of ten home buyers until next April as part of a move to boost the housing market (BBC News). Rishi Sunak yesterday announced buyers will pay no stamp duty on the first £500,000 of their purchase for the next nine months. The measure - effective from 15 July to 31 March 2021 - will reduce the average stamp duty bill for a main home from £4,500 to zero (Daily Mail, p12).

The suspension of stamp duty will revive the housing market, according to industry experts, as buyers and sellers emerge from the coronavirus lockdown (The Guardian, p6). The property website Rightmove said traffic to its listings jumped by 22 per cent shortly after the chancellor confirmed the immediate £3.8 billion tax break, and estate agents said they expected the change to boost activity.

Responding to the chancellor's announcement on stamp duty, Eric Leenders, Managing Director of Personal Finance at UK Finance, said:

The chancellor's announcement on stamp duty should give a welcome boost to the housing market and in turn have positive knock-on effects for the wider economy.

?This measure designed to re-boot the housing market builds on the wide package of support put in place by mortgage lenders, working with the regulator and HM Treasury, to help customers through these tough times.

"The industry has a clear plan to help homeowners whatever their financial situation and is committed to providing ongoing support to those customers who need it.

COST OF CHANCELLOR?S ECONOMIC SUMMER STATEMENT

The chancellor's decisions in his summer statement, alongside plunging tax revenues, are likely to push the budget deficit up to £361.5 billion (Financial Times, p3, £). This figure is more than six times the deficit forecast in March by the Office for Budget Responsibility, however, Mr Sunak said his intervention was necessary to protect and create jobs at a time of ?profound economic challenges?.

According to figures released by the Treasury, public spending against coronavirus has risen to nearly £190 billion (BBC News). The total is nearly £3,000 for every person in the UK and more than the entire planned health budget for 2020-21.

It means the cost of the crisis has risen by more than 40 per cent since last month, when the Office for Budget Responsibility estimated it at £133 billion.

Separately, the FTSE 100 opened flat today following the chancellor's summer economic statement yesterday (City AM).

NEWS IN BRIEF

The number of homes for sale stayed close to record lows last month, despite evidence of recovery in demand (The Times, p40, £).

Bank of England chief economist Andy Haldane has warned the economy will be hit by second, third and fourth waves of coronavirus (Evening Standard).

The negative impact of the coronavirus on Britain's jobs market seems to have been greatest in May before a partial recovery in June, according to the Office for National Statistics (The Guardian, p37).

The Federal Reserve's top bank regulator warned that the economic outlook remains uncertain and that the financial sector may face more pain as the pandemic wears on (New York Times, p30, print only).

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