Rantings of a disgruntled London Property Finder

Today we spent the day out of the office at the IOD annual convention, in the Royal Albert hall.  Politicians never confirm until late in the day so Alistair Darling late entry as the first speaker was an interesting start to the day.

Given the audience, the Chancellor’s principle objectives were to defend the need for additional taxation particularly the new 50% tax  and also shouting about all the concessions and help the government is giving to smes.

Justifying the need for additional taxation, our hearts bled to hear Alistair Darling bemoaning the enormous hole in govenment revenue since the beginning of the recession due to amongst other things, the fall in stamp duties collected.Rather an interesting point to make to a hall full of business people, given that during these difficult times we need to make pragmatic decisions every day. For example, whether it is better to have a proportion of a little or all of nothing.

The Chancellor has missed a trick with stamp duty. Reducing the rate of stamp duty payable on properties below 500K would have helped boost transaction numbers which could in turn have boosted the revenues the government gains from property and boosted confidence in the property sector and the economy as a whole.  First-time buyers who we work with, tend to buy properties worth £400,000 and above.  Assuming they don’t spend over half a million, that means stumping up 3% stamp duty or using one of the avoidance schemes.  For the many who don’t have helpful accountants or London Property Finders like me, that means finding an additional £13,500 for a flat purchased for £450,000 - the price of a good 2 bed flat in a great area in London.  Typically we will charge just short of £7,000 for finding the fabulous flat - but then we would have introduced the buyer to property they would never have found on their own and negotiated a great deal which won’t fall through.  What does the Chancellor do?

Temporarily cutting stamp duty by half for property below £500K would make a real impact on the London property market and the Chancellor would gain a little of alot rather than a great deal of very little!This London Property Finder thinks it would have been a welcome if pragmatic course of action

Technorati Tags: First time buyers, London Property Finder, London property market, london property market news, Stamp Duty

Tags: First time buyers, London Property Finder, London property market, london property market news, Stamp Duty

Rantings of a London Property Search Agent

Well it could have been a very different afternoon could it not? 

Stamp duty, REITS, empty rate relief and clarification on regulation for buy-to-lets: there is really no good news.  And what on earth are they doing pushing £80m into shared ownership schemes: pushing hard pressed first-time buyers into quarter/ half shares of over-priced one bedroom flats?  It’s a nonsense!  But don’t get me started on that little chestnut!  

Acknowledging that the housing sector is key to the recovery of the UK economy, Alistair Darling said: ‘the key to the health of our society is the long term supply of housing€™ so the government are supporting the construction industry to ensure more homes are built with £500million for stalled schemes and a further £100m to encourage local authorities to build green homes.

I’ve got mixed feelings about this to be honest, because mass-produced new-build is notoriously over-priced and frankly, unfortunately developers and investors caught in the headlights need to live with the consequences.   This is a long term fix, but has been widely criticised by the developers it is designed to help, for being unclear.  Given the fiasco of the mortgage support scheme, that is an entirely fair point.  Interestingly, although most banks closed their book to developers last year, self-builders are not struggling to get finance.  It this because their due diligence is not dependent on unsustainable sales figures?

I am most irritated about stamp duty.  Significant reductions  for property sub-£500K where 3% is payable would have assisted the market and injected a little confidence.  The extension of 0% stamp duty for transactions up to £175,000 for the rest of the year is certainly welcome, but so much more could have been done.  This is not going to help many buyers in London and therefore is pretty much irrelevant to the property market in the capital.

Technorati Tags: Business rate relief on empty properties, London property, London Property Search Agent, REITs, Stamp Duty, The budget

Tags: Business rate relief on empty properties, London property, London Property Search Agent, REITs, Stamp Duty, The budget

Musings of a London Property Search Agent

Bigwigs from the RICS (Royal Institution of Chartered Surveyors), the NAEA (National Association of Estate Agents) and others have called on the Chancellor to clarify any changes to stamp duty payments asap, reports The Telegraph today. August is traditionally a slow month in the world of property sales and this year is particularly bad but some property professionals fear buyers will fail to complete before September to avoid missing out on any concessions.

Ideas mooted have included lengthening the deadline for payment of stamp duty. This would be of particular help to first time buyers who routinely pay in excess of £250,000 for their first property, incurring a stamp duty liability of over £7,500.
 

The mid-market would also benefit, as many people who want to move up the property ladder prefer to improve than to move to avoid the tax which works out at £40,000 on a £1,000,000 property - a good-sized family home within zone 2 in London.
 

Stamp Duty Liability as of 07.08.08

• 0% for residential property priced up to £125,000
• 1% for residential property priced between £125,001 and £250,000
• 3% for residential property priced between £250,001 and £500,000
• 4% for residential property priced over £500,001

To take advantage of this period of stamp duty relief contact this London Property Search Agent.

Technorati Tags: London Property Search Agent, NAEA, property ladder, RICS, Stamp Duty

Tags: London Property Search Agent, NAEA, property ladder, RICS, Stamp Duty