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Before the Conservative victory high net worth buyers and sellers alike were wary of Labour’s planned “Mansion Tax” – designed as a levy on houses above £2 million.
At the beginning of the year we saw a significant reduction in the number of transactions in the prime London space. The three main cited factors were the impact of stamp duty, the looming prospect of mansion tax and Labour’s manifesto around non-domicile tax. Yet since the outcome of the general election, the higher end of the market is seeing market volumes return and the market consensus is that a 1 million mortgage upsurge is predicted.
Indeed, our partner, GetAgent– the estate comparison site – more than doubled in the weeks after the general election, according to figures released by the website this morning. In the week before the poll 294 properties were registered, whereas now there are 639.
While the property and 1 million mortgage market at large is broadly recovering it is still affected by Osborne’s stamp duty changes which increased the taxation on homes sold above £1 million. However, at Enness we believe these changes are evening out with the renewed confidence in the economy and GetAgent’s data supports this assumption. The stamp duty changes are favourable for properties in the sub £1 million bracket, meaning the buy to let 1 million mortgage market has benefited from the change.
Enness believe the Conservative victory means business as usual for the property market with the prospect of mansion and non-dom tax removed.
Within the buy to let sphere we are seeing moves to meet the growing needs of the private rental sector, often through refurbishment, expanding existing properties, or converting properties into homes of multiple occupancy. As a response to these changes we are soon to release a “How to Use Personal Income to Buy to Let Guide” for our strategic investor clientele as we believe the private rental sector should see a lot of growth over the next few years.
We have an optimistic outlook for the next couple of years and fully anticipate the emergence of some very competitive mortgage rates in the months to come. If you would like to explore how the mortgage market changes have affected you, please do get in touch.