There is no certainty about the contents of the Autumn Budget but speculation about a Mansion Tax, Stamp Duty changes and capital gains charges on the sale of high value homes is already having an impact.
Mansion Tax
- Sales agreed for £2m+ homes, which are the subject of a potential mansion tax, are down 13% year-on-year
- Homes priced between £500,000 and £2m, which would be impacted by potential stamp duty changes in England, or perhaps the rumoured capital gains tax, have seen sales agreed drop by 8% year-on-year
- The under £500,000 market has been less impacted, with sales agreed down by only 4% on this time last year. This mass-market sector is likely being unsettled by general Budget jitters rather than specific policy rumours
- Less than 0.5% of all homes sales agreed this year have been for properties with an asking price of over £2m
- Around 1% of homes for sale are priced above £2m
Stamp duty
- Just under a third (30%) of homes for sale in England are priced at over £500,000, and would be subject to the proposed new annual property tax which would replace stamp duty
- In London, more than half of homes (59%) have an asking price of over £500,000 and would be subject to the rumoured annual property tax if it came in, versus just 8% in the North East
- A fifth (19%) of agreed property sales so far this year in England have been for homes over £500,000 but this varies regionally:
- In London, more than half (52%) of agreed property sales so far this year have been over £500,000
- In the North East, just 4% of agreed property sales have been for homes over £500,000 so far this year
Capital gains tax
- Just over 1% of all home sales agreed this year have been for properties over £1.5m, and would be subject to the potential new capital gains tax if it came into effect. However, the regional impact is varied:
- In London, one in ten (11%) of homes for sale are in this price bracket, with 5% of agreed sales so far this year being for homes above £1.5m
- In the South West, 0.7% of agreed sales are in the £1.5m price band, with 2% of available homes for sale in this price bracket
- In the North East, just 0.1% of agreed sales are in this upper-end bracket, with only 0.5% of all properties available for sale priced at over £1.5m
Mansion Tax
Data shows sales agreed for £2m-plus homes, which are the subject of a potential Mansion Tax, are down 13% year-on-year.
Homes priced between £500,000 and £2m, which would be impacted by potential Stamp Duty changes in England, or perhaps the rumoured capital gains tax, have seen sales agreed drop by 8% year-on-year
The under £500,000 market has been less impacted, with sales agreed down by only 4% on this time last year. This mass-market sector is likely being unsettled by general Budget jitters rather than specific policy rumours
Fewer than 0.5% of all homes sales agreed this year have been for properties with an asking price of over £2m, while around 1% of homes for sale are priced above £2m.
Stamp Duty
Meanwhile, just under a third (30%) of homes for sale in England are priced at over £500,000, and would be subject to the proposed new annual property tax which would replace Stamp Duty.
In London, more than half of homes (59%) have an asking price of over £500,000 and would be subject to the rumoured annual property tax if it came in, versus just 8% in the North East
A fifth (19%) of agreed property sales so far this year in England have been for homes over £500,000 but this varies regionally, according to Rightmove.
In London, more than half (52%) of agreed property sales so far this year have been over £500,000.
In the North East, just 4% of agreed property sales have been for homes over £500,000 so far this year
Capital Gains Tax
Additionally, just over 1% of all home sales agreed this year have been for properties over £1.5m and would be subject to a potential new capital gains tax if it came into effect.
However, the regional impact is also varied, Rightmove said.
In London, one in ten (11%) of homes for sale are in this price bracket, with 5% of agreed sales so far this year being for homes above £1.5 million.
In the South West, 0.7% of agreed sales are in the £1.5 million price band, with 2% of available homes for sale in this price bracket
In the North East, just 0.1% of agreed sales are in this upper-end bracket, with only 0.5% of all properties available for sale priced at over £1.5 million
Rumours of the contents of the forthcoming Budget are affecting the market, as we’re seeing a greater hesitation in sales activity, especially at the upper end, which has been the focus of most of the discussion.
While there is also a general unease at how the Budget may impact personal finances, the majority of home moves would be unaffected by the rumoured changes to property taxes. However, we’re also seeing the uncertainty surrounding the Budget dent the confidence of some potential movers, and I think most are now fed up with the rumours and just want to see how their finances are going to be impacted.
