There’s now over half a million Brits thankful that Labour’s Mansion Tax policy never saw the light of day, writes Richard Carr.
Residents of Kensington Palace will be grateful the Mansion Tax policy never become a reality
It’s now a distant memory, but in the lead up to this year’s general election Mansion Tax was one of the most widely talked about policies. Labour proposed to heavily tax properties worth over £2m to help fund the NHS.
Richard Carr has previously spoken of the negative impacts that a Labour win would have upon UK citizens’ lives and now property expert Zoopla has warned that thousands of pounds could be wiped off the value of homes if Ed Miliband gains power.
David Cameron’s party has also revealed its ‘Help-to-buy’ ISA policy which will see the government provide young savers with a £3,000 bonus.
On the opposite side of the bench, Labour’s housing policies include building 200,000 new homes by 2020, as well as new towns and garden cities. However, the party has come under fire for its proposed ‘Mansion Tax’ policy, which they would introduce to help reduce the NHS deficit.
With the general election set to take place later this year, Labour’s Mansion Tax policy is once under scrutiny, writes Richard Carr.
UK MPs favour higher rate council tax
It’s fair to say that the response to the Labour party’s Mansion Tax proposals, since the announcement last year, has been negative. Although many believe there is a need for changes to the tax system, Mansion Tax is not seen as the way forward.
Labour’s Ed Miliband
Richard Carr, a commercial and residential development consultant, is strongly against Labour’s proposals, but is of the opinion that a reform to the tax system is needed.
The latest proposals from UK MPs on reforming annual property taxes on high value homes would be to introduce additional higher rate council tax bands.
69% of MPs were in favour of the idea, whilst three quarters agreed that a reform to the current council tax system was required.
There are still six months until the 2015 General Election, but already the potential policies that may be enforced are having an effect on the property market, reports Richard Carr.
Rental market booming
Propertyweek.com reported last week that London’s £100,000-plus and £1million-plus per annum rental markets are booming – and they believe it’s because of ‘Mansion Tax’ and the recently amended ‘Stamp Duty’.
There has been a 12.8% rise in the number of properties let at rental values of over £10,000 per week compared to the same period in 2013.
Remarkable the average weekly rent in London’s ultra-prime lettings market is more per year than it costs to buy the average home outside the capital in England and Wales.
In his final blog post of the week, Richard Carr explains the reforms to ‘Stamp Duty’ outlined in George Osborne’s final ‘autumn statement’ before next year’s general election.
The new stamp duty reforms are now in force and will affect homebuyers across the country. During his autumn statement speech, Osborne claimed that stamp duty will be cut for 98% of homebuyers who currently pay it.
For example: you would receive a tax cut of £4,500 when purchasing an average £275,000 family home.
Stamp Duty reformed
What bands are affected by stamp duty?
Below are some easy bullet points to help you understand how much stamp duty you will now pay:
Richard Carr is a commercial and residential development consultant who has a successful track record of achieving planning permission to help redevelop sites. His latest work has seen him achieve planning for apartments and homes in the Poole area of Dorset.
Is the election affecting house prices?
His opinion on the current state of the housing market is shared by Jeff Fairburn, the chief executive of house building firm Persimmon. Fairburn has blamed the looming general election for a delay in planning as his firm struggles to get sites open.
Planning appeals are on the increase
Speaking to the London Evening Standard, Fairburn criticised the planning system: “Running up to the election there will be political decisions made in local councils and the planning system means those local decisions can go against the officers’ recommendation, and you need to go through the appeal route.
Scotland introduces new taxation powers for first time in more than 300 years
Commercial and Residential Development Consultant Richard Carr has operated in the sector for 30 years, achieving planning permission for both himself and clients.
Scotland introduces a new Land and Building Transaction Tax
Scotland’s Land and Buildings Transaction Tax (LBTT) is set to replace the current stamp duty land tax. It will be charged at 10% of the purchase price of a home between £250,000 and £1m and 12% on more expensive properties.
Mixed reaction to proposed new taxations
The LBTT announcement was made as part of the draft Scottish Budget 2015/16. It will supposedly benefit buyers of cheaper properties, whilst the new rates will only be payable on the portion of the total value which falls within each band.
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.
Bubble about to burst on London housing market
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.”