Tag Archives: city
UK residential property stamp duty revenue hits record high
The UK tax man, HMRC, collected a record £7.5 billion in stamp duty from residential property transactions in 2014/2015, official figures show. This was up from £6.45 million the previous year and from £4.9 billion in 2012/2013 and the total tax collected from home buyers in the UK has grown by 165% over the last six years alone. Transactions in London contributed the most residential stamp duty revenue at just over £3 billion, followed by the South East at £1.6 billion. Together these two regions accounted for 66% of the total tax take. Between 2008/2009 and 2014/2015, stamp duty revenues in London have grown by 248%, compared to around 158% in the East of England and 140% in the South East. Other English regions had between 75% and 120% growth in the same period. The increase in London reflects the growth in house prices in the city over this time compared to the rest of the country, as well as the fact that the higher rates of stamp duty on property transactions worth more than £1 million mostly affect London, according to an analysis of the figures by real estate firm Knight Frank. Grainne Gilmore, head of UK residential research at Knight Frank, pointed out that last December’s cuts in stamp duty for homes worth up to £1.1 million has had little impact on the tax receipts from home buyers in the year to April. ‘Overall, home buyers still paid more in stamp duty than over the previous 12 months. While the increased take from stamp duty reflects the growth in house prices and a pick-up in transactions, another factor has been the increases to stamp duty charges, especially towards the top end of the market,’ she said. She also pointed out that residential stamp duty garnered £7.5 billion for the Treasury in the year to April, more than double the amount raised back in 2002/2003 and the Treasury’s windfalls from home buyers in England has grown by 165% over the last six years alone. ‘The relative burden of stamp duty is also highlighted by the data. Londoners paid 43 times more stamp duty than buyers in the North East over the last year, a reflection of the widening of the North/South divide in terms of activity and prices, but also the higher stamp duty charges for more expensive homes. Buyers in London and the South East accounted for 66% of all stamp duty receipts on residential property in the year to April,’ Gilmore explained. ‘It remains to be seen what the impact of the new stamp duty regime will be for the Treasury in the coming year. Despite hitting a record high for residential receipts in the year to 2015, the total stamp duty tax take at £10.7 billion is £800 million lower than the Treasury forecast when it made the changes to stamp duty back in December,’ she added. According to Tom Bill, head of London residential research at Knight… Continue reading
West London prime property market out performs rest of sector in London
Residential property growth in the prime west London market is outperforming the rest of the sector in the city, new research shows. The area starting in Hammersmith and heading west to Ealing saw average property values grow by 4.1% in the second quarter of 2015, leaving annual growth at 0.5% compared to the small falls seen in other prime London markets. The value of properties priced over £2 million, the majority of which are concentrated in Hammersmith and Chiswick, fell 2.2% over the past year, the data from real estate firm Savills also shows. At the top end of the market, buyer caution has been evident, the firm's report says, and the the price falls largely resulted from stamp duty changes announced in the 2014 Autumn Statement and uncertainty surrounding a mansion tax in the run up to the general election. Stronger growth was recorded in the lower value markets, particularly in the £750,000 to £1 million market where buyers benefited modestly from the stamp duty reform. In the prime markets below £750,000 although price growth was positive, it was slower as new mortgage regulations limit the amount buyers can borrow. Average values in Ealing are around 25% cheaper than Hammersmith and Chiswick and consequently saw the strongest growth, of 3.9% over the past year. 'Since the election some of the deferred pent up demand is beginning to flow back into the market, although the new stamp duty rates are still keenly felt by buyers at the top end of the market. This has restricted any significant increases in both prices and transaction numbers and we expect this to continue over the rest of 2015,' the report explains. Nonetheless, Savills is forecasting price growth to return to the market in 2016 and values to rise by 22.7% over the five years to the end of 2019. In the prime west London rental sector average rents increased by 1.2% over the three months to the end of June, leaving rental growth flat on an annual basis. But Savills says that corporate relocations play an important part in the west London prime rental market and are a growing source of demand. Over the first half of 2015 some 67% of tenants were renting due to employment relocation compared to 55% in 2014. 'Over the next five years, the London economy is forecast to continue strengthening, particularly in the technology and telecommunications industries, which will underpin demand for prime rental property over the medium term,' the report points out. However, it also points out that a potential risk to the sector is the level of new stock being brought to the market by overseas investors in certain locations on the fringes of prime London. In west London the largest prime development region is White City, which may lead to rents coming under pressure in the surrounding areas. But, across the prime London markets as a whole Savills expects rents to rise by 17% over the course… Continue reading
Key commuter city sees prime property market perform best in UK
Winchester, a popular commuter city within reach of London has seen its prime property prices outperform the wider UK market, new research shows. Prices in the city, famous for its cathedral and history, increased by .4% between April and June, taking the annual change in prices in the city to 6.3%, according to data from international real estate firm Knight Frank. Such price growth means that Winchester has comfortably outperformed the wider UK prime market where values have risen by 0.9% on a quarterly basis and 2.3% on an annual basis. Winchester has also registered stronger price growth than other prime city markets including Bath, Bristol and Oxford. A shortage of prime properties for sale, combined with strong demand for homes in thriving town and city markets, has contributed to this out performance, according to the Knight Frank analysis report. It shows that the number of properties for sale in the city was 17% lower at the end of July than at the same point a year previously. In the prime market, the number of properties for sale valued at over £500,000 was 20% lower, a factor which, combined with strong demand, can put upwards pressure on prices, the report explains. Against this backdrop, demand for property in Winchester remains widespread.'As well as those moving up the ladder locally, the city remains popular with commuters both from the wider South East region and from London. Figures from the 2011 Census show that some 53% of people living in Winchester work outside of the city,' the report says. Buyers from the capital are also taking advantage of the price differential between property prices in London and elsewhere in the country. The report points out that while there has been sustained price growth in Winchester over the last year, changes to stamp duty announced in December have made buyers at the top end of the market more price conscious. This has resulted in slower than average price growth for the most expensive properties in the city since the introduction of the new rates. Meanwhile, in geographical terms, price growth has been fairly uniform across the city. Property values in Hyde and the city centre have risen by 3.2% and 3.1% respectively over the first six months of 2015, and by 6.9% and 6.8% over the past year. To the south and the east of the city centre in St Cross and St Giles Hill annual price growth of 5.7% and 6% respectively has been recorded. Overall, there were over 200 sales with a value of £500,000 or more in Winchester over the 12 months to June, 23% higher than the previous 12 months, according to data from the Land Registry. Continue reading
