Spare a thought for the poor millionaire now forced, through
this
year’s UK Budget, to pay more for the privilege of using
central
London’s booming
luxury property market as a safe haven for his
investment funds, away from unhealthy currencies.
Spare a
thought also for home-grown millionaires in other UK property hot spots. They
too will be caught in this new 7% Stamp Duty trap of the
Chancellor’s making. Any attempting to escape is futile – tunnelling
under the higher tax barrier through the means of an offshore or foreign
company has been stopped by way of a massive 15% Stamp Duty.
Will this have much impact on the property market generally?
Not really, as the early introduction of these measures leaves no room
for a mansion-tax-beating rush to buy, and this is a one-off measure
aimed at those who really should be able to afford it. So the
impact on sector values should be negligible. All in all this new
measure will probably be met with a sigh of resignation rather than a decision
to spend a million or two less, just to avoid the extra tax.
But do expect to see fewer houses on the market at £2.1 million and more
at £1.99 million. And, who knows, perhaps this top level of
stamp duty could even become a trendy new status symbol for the wealthy.
Of greater significance is how the Budget affects the rest of
the property market. Apart from the small tax benefit to the
lower paid there seems little in the Budget to stimulate much greater
activity, save for a few small pieces of new legislation that somehow fit
into the jumbo jigsaw that is our nation’s fiscal recovery. But
perhaps the Chancellor has taken the view, “physician heal thyself”.
Under the radar of the British property press (which is none too sensitive)
the market in many places has quietly been perking up. There
have been rumours of first time buyers – tempted out of hiding before the
end of their own special tax relief; also, even one or two mortgages have
been granted.
Up and down the country many estate agents
cautiously report increased sales figures. This means several things: buyers
are on the move and agents are valuing reasonably. Most importantly,
sellers are listening to reason rather than the little voice of avarice that
we all have, but which needs to be mastered when selling property in
sluggish conditions.
The government’s move to relax the building rules in rural areas
could vie for attention with the Budget. This should be of concern
to everyone as it is our heritage which could be under threat of
concrete. Visions of bulldozers parked on the village green will cause
outrage. And when developers, who through the Budget will now receive some
extra funding for new homes, meet head to head with Britons-in-bloom
there will be strife. And there should be. But this relaxation
may bring new life to struggling rural communities as well as providing
much needed housing. So it will be very much up to local planners to prevent a 1960s style architectural catastrophe. Also the
public will need to demand thermally efficient, economical, affordable
but stylishly attractive and appropriate homes which will sit
comfortably in a rustic environment.
So, the verdict on the 2012 budget, as far as the property market
is concerned, seems to be neutral.
Please contact either Andrew Richardson, Jeremy Richardson or Richard Killoughery on 020 8643 7777 to get moving or email us at sales@christiesworld.com.
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