Taylor Scott International News
The prime central London property market has seen a year of two halves but uncertainty over stamp duty levels is set to continue to affect the upper part of the sector in 2016, new research suggests. Just over a year the prime market was hit by increased stamp duty on properties worth more than £1.1 million and now this year extra duty of 3% is to be levied on buy to let investors and second home owners. The latest report from real estate firm Knight Frank explains that while the new measure is an attempt to address concerns surrounding affordability and house price inflation, it raises fresh questions over the dampening effect on tax revenues just as buyers and sellers in prime London were showing tentative signs of absorbing the previous increase. ‘Transactions and revenue have declined across London in the period following the December 2014 increase. It highlights concerns over the financially viability of the stamp duty reform, which had the welcome aim of increasing liquidity and affordability below £1 million but runs the risk of becoming a counterproductive deterrent above that level,’ said Tom Bill, head of London residential research. Meanwhile, the sub-£2 million market outperformed the rest of prime London in the second half of 2015, continuing a trend of recent years. In particular, properties worth less than £1 million have grown by more than any other price bracket. Bill explained that the highest growth has largely been outside the higher price brackets of prime areas of central London over the last 20 years. The Knight Frank analysis report highlights the markets where price growth was strongest during each year since the first quarter of 1995 and on a journey that began in Lambeth Walk and ends in Turnpike Lane, £50,000 would have become £1.18 million after stamp duty and moving fees are taken into account, representing a rise of 2,264%. The theoretical journey began in south London before moving further east to areas like Barking and Dagenham in the early 2000s as east London matured as a residential market. It then moved to prime central London in the run-up to and immediate aftermath of the financial crisis, including Marylebone, Belgravia and Fulham. Finally, as price growth pushed outwards from central London as the UK economic recovery consolidated after 2013 the strongest growth was found in the north London markets of Walthamstow and Turnpike Lane. Taylor Scott International
Taylor Scott International, Taylor Scott
