It was reported last week that house prices in London have fallen for the first time in nearly four years, a statistic that has come as no surprise to Richard Carr.
Mansion Tax already having a negative impact
Richard Carr has provided expert advice to a number of high net worth property developers to help them achieve planning permission and maximise profits on their investments.
He recently wrote about the negative effect that Labour’s proposed ‘Mansion Tax’ could have on the property market – however, it already looks to be making an impact. The party’s proposed new tax scheme would affect homeowners with properties valued at over £2m, and it is those houses that are seeing very little activity according to estate agent Charles Puxley:
“Traditionally September is a busy month for instructions in central London. This has not happened this year and there is notably very little activity at just over the £2m mark. Mansion tax it seems to be a real worry. It will decimate London prices.”
London suffering whilst the rest of the UK sees growth
The UK has enjoyed a long period of positive sentiment according to the Royal Institution of Chartered Surveyors (RICS), which stretches back to January 2011. But, the industry body has finally reported a drop in values in the capital.
Despite London’s woes, growth is expected across the rest of the UK over the next three months. The RICS expect forecast values to continue to decrease in London as buyer demand falls along with new vendor listings, leading to lower transaction levels.
UK homeowners losing confidence in the market
Property portal Zoopla recently produced a report which highlighted that UK-wide homeowner confidence had fallen to a 15-month low. The survey of 6,746 homeowners found that the proportion expecting prices in their area to go up over the next six months had fallen from 92% three months ago to 88%, the lowest level since July 2013.
The housing market will stabilise after the election
That is the opinion of Richard Carr who isn’t at all surprised by the recent fall in prices and believes that Ed Balls and Ed Miliband’s recent comments haven’t helped the housing market. He believes that a more sensible growth dynamic has to be in everybody’s interest in the long term; something that will be possible once the election is out of the way.