London Has Peaked

westernpromise

The tax on buying in London is now so high that it has basically brough transaction volumes to a halt.

SDLT increases the cost of the transaction five or sixfold, even if you're simply swapping your main residence for another of similar price. You get absolutely nothing formthis money so everyone who can just extends.

We'd need a stamp duty holiday before I'd consider moving - up, down, or sideways.

Rich2808

I do find it comical that the reason why people aren't buying is due to tax rates - that old chesnut.

The annual property tax - council tax - is laughably low. A single oligarch living in a £30m apartment at One Hyde Park will pay barely £1,000 a year in council tax - as Westminster's council tax is so low and he would get single person discount. A pensioner couple living in Croydon could well pay double that. The City and Kensington and Chelsea also have council tax levels well below the national average - effectively half.

Arguably prime London property is undertaxed on an annual basis - in Manhattan the oligarch would potentially pay tens of thousands of dollars a year, in property taxes.

Maybe the reason people aren't buying is because they think the prices are too high and the properties not value for money!

antrobus

Rich2808 wrote: »

I do find it comical that the reason why people aren't buying is due to tax rates - that old chesnut....

Do you?

Who said that? Or is just a straw man?

Rich2808

antrobus wrote: »

Do you?

Who said that? Or is just a straw man?

Annual property taxes in prime central London are way below what they would be in a comparable major world city. Only in the UK would such properties be taxed at less than half the level as a retired couple loving in a suburban semi.

I merely observed that the annual property tax in London is incredibly low.

And what's the best way to lower your stamp duty bill - pay less for the property. Higher prices mean more stamp duty.

antrobus

Rich2808 wrote: »

...I merely observed that the annual property tax in London is incredibly low.....

No, you didn't. You said "I do find it comical that the reason why people aren't buying is due to tax rates - that old chesnut."

Who are these people that are arguing that? I can't see anybody here putting forward that argument. Thus it's a straw man, designed to shift the debate away from London property prices and on to a something a little more 'political'.

Don't be so flippin obvious.

Besides, CT in suburban London is much the same as in other metropolitan areas in the UK. They tend to be lower in central London, because those boroughs make a lot of money out of car parking charges. Everybody knows that.

You can always start your own thread about the alleged iniquities of the CT system, ya' know.

surfer9

It's not just London - South East prices are getting flaming ridiculous, specifically the commuter belt.

If house prices are going to rise and rise like this then do us First Time Buyers who have parents with properties need to care about buying anymore?

Our inheritance is going up and up and up and up and up and up and up.

The main reason I'd like to purchase a property is so that I am mortgage and rent free in my later life. But as my inheritance increases more and more each month.....do I need to worry about my financial situation in my later years.

This is not really the way I wanted to view my financial situation going forward, but with house prices at the ridiculous prices that they are right now and with them due to go up another 10% this year then what can I do.

We are getting ripped off.

- Low interest rates on savings for years.
- The government is not building no-where near enough housing.
- The government's Help To Buy scheme has according to many - increased house prices.
- The government's Starter Homes scheme with 20% discount has come too late. House prices will have risen approx 20% since that scheme was announced and not a single Starter Home has been built yet.
- Shared Ownership schemes are few and far between and you are restricted to only buy in the area you live and work in.

£200,000 for a 1 bed Maisonette - you can kiss my.....


If there were some Starter Homes or Shared Ownership schemes in my borough - then I'd likely be able to afford a reasonable property. But there is virtually nothing 'affordable' here.

If the above doesn't happen in the next year, I'm either going to give up or have to move far away.


After this year has passed - I believe very very very few people who are currently in their 20's will be able to ever afford to buy/live in the South East commuter belt regions. But as people can't afford London, they come to these areas and so the demand continues and house prices carry on rising.


I dream there will be a crash soon. But it likely won't happen.

wotsthat

London +9.4% in 2015

http://www.bbc.co.uk/news/business-35586056

mayonnaise

I wonder if Bubbles eventually bought that [STRIKE]3-bed[/STRIKE] 2-bed semi in Rodney place.

wotsthat

mayonnaise wrote: »

I wonder if Bubbles eventually bought that [STRIKE]3-bed[/STRIKE] 2-bed semi in Rodney place.

I keep saying if someone wants to buy, has the cash, can get the finance and has found a place then just get on with it. It usually works out. It just does.

A wife is usually quite handy in this respect because they cut through the BS. I can just imagine house hunting and then at the last minute saying 'hang on duck, I think we should wait because...

mmr came in, slowing things down a bit, perhaps giving people a chance to reflect on the enormous amount of debt they were about to take on.
real wages haven't grown for several years,
mark carney has been taking up the possibility of rate rises,
the eu economy (our biggest trading partner)is on the brink of recession,
trade war with russia (where does europe get its gas from?),
china hot money drying up,
US tapering,
wars (one of which is in europe),
winding down of funding for lending.
the only things sustaining the market as the moment are unnaturally low interest rates and help2buy
not enough to counter the headwinds.
sentiment has changed and sentiment moves the market.

i predict a sharp correction henceforth...

I expect most men would expect to hear something like '!!!!!! are you talking about? We're buying a house not interviewing to be the head of the United Nations'

Conrad

wotsthat wrote: »

A wife is usually quite handy in this respect because they cut through the BS. I can just imagine house hunting and then at the last minute saying 'hang on duck, I think we should wait because...

Great point. Women are IMO much more level headed and don't fill their heads with philosophical conundrums.

In the final analysis a tiny fraction of owners end up loosing their home so as you say, it just does work out. Many do well out of property and can downsize in retirement.


If you watch nature documentaries you see over and again the critical importance of each organism capturing its own secure territory / den. It's an evolutionary imperative, hard wired.