What does the Autumn Statement mean for the property market?

Capital Gains Tax to be introduced for non-residents who sell residential property in the UK

Chancellor George Osborne's Autumn Statement today to MPs included a number of plans for the property market.

He announced that around £1bn in loans will be made available to help housing developments in various sites around the country including Manchester and Leeds. Councils will also sell off the most expensive social housing in a bid to house more families, as well as regenerate rundown estates.

Most property commentators focused on the Capital Gains Tax move which will be imposed on any gains made by non-residents who sell their residential property in the UK.

Liam Bailey, Head of Knight Frank Global Research, said:"Tax is not the primary driver for the majority of international buyers of residential property in London. We anticipate that the removal of the CGT exemption for non-resident purchasers will have only a marginal impact on demand and pricing. It is important to note that the change to CGT rules brings the UK in line with other key investor markets, such as New York and Paris."

Mark Harris, chief executive of mortgage broker SPF Private Clients, added: "We await more clarity as to whether this will affect non-residents who have owned property in the UK for many years. The introduction of such a tax will affect people's decisions on whether they sell or not, and may persuade homeowners to hold onto their properties for longer, applying the brakes to the upper end of the property market."

Fionnuala Earley, Research Director at Hamptons International, said: "The Chancellor is keen to be seen to be doing something to cool rapid house price growth in London and increasing tax on foreign buyers looks like a vote winner but in reality the proportion of foreign buyers is a lot smaller than one might think. Our data shows that 70 per cent of buyers in London are British nationals with the majority of the remainder being resident in the UK. Over the course of this year, the proportion of sales to foreign buyers has been decreasing, as the mainstream market recovers.

"Inevitably any announcement on property tax will cause some ripples in the market for residential investment, but in reality it’s unlikely to have much effect on the wider market.  We already expect the prime London market, which is characterised most by foreign wealth, to cool."

Commenting on the impact on mortgages of the announcement on the raising of the retirement age for those aged 49 or younger,, Adrian Anderson, director of mortgage broker Anderson Harris, said: "While the pension age has been steadily rising for a while, lenders are well behind the curve. Most will simply not lend past retirement age, which they take to be 65, yet the reality is that most of us will be working for far longer than that. Lenders need to address their policies now, as most of them are already outdated, and ensure lending to a maximum age of 70 as an absolute minimum."

Simon Rubinsohn, RICS Chief Economist said: "As we’ve been saying for a long time, the lack of housing supply is crippling the property market. If Help to Buy is to remain, Right to Buy extended, and expensive social housing sold off then the Government’s commitment to building houses simply must be extended.

"The £1bn of loans to unblock housing development across the country will contribute towards housing need and will drive construction jobs. However, we still believe housing is not at the centre of a coordinated property-led growth that supports a balanced regional recovery where all can access the market. The increase in the local authority borrowing cap will only make a very minor dent in the housing deficit.

“It was also disappointing to see long overdue changes to stamp duty have been ignored, particularly as the amount of revenue generated from this is rising sharply. The government plans to collect more than £60bn over the next five years in stamp duty receipts from British householders. Moving away from stamp duty brackets to a marginal system would be a boost to those struggling with the cost of living and help boost the number of property transactions. This will remove the so-called ‘dead zone’ created by the previous structure which saw a dearth of properties on the market between £250,000 and £270,000."

David Newnes, director of LSL Property Services, owners of the largest lettings agency in the UK, said: "The pledge of £1bn of loans to unlock large housing developments is certainly a welcome move and plans to increase local authorities’ housing revenue account borrowing limits are encouraging measures, both will play a part in boosting house supply, whilst at the same time preventing house prices from rising out of reach of buyers.

"Equal focus on expanding the 'right to buy’ offer and the Government’s investment into affordable housing shows efforts are being made. The government must continue to lend a helping hand to aspiring buyers, so that they can achieve their dream of home ownership, while emphasising the need for more homes to support a healthy rate of recovery for the market as we move into 2014."

 

Discover more property articles at Homes and Property
PROMOTED VIDEO
Sport
Luis Suarez looks towards the crowd during the 2-1 victory over England
sport
Life and Style
Cheesecake frozen yoghurt by Constance and Mathilde Lorenzi
food + drinkThink outside the cool box for this summer’s frozen treats
News
John Barrowman kisses his male “bride” at a mock Gretna Green during the Commonwealth Games opening ceremony
peopleBarrowman's opening ceremony message to Commonwealth countries where he would be sent to prison for being gay
Sport
Sir Bradley Wiggins removes his silver medal after the podium ceremony for the men’s 4,000m team pursuit in Glasgow yesterday
Commonwealth games Disappointment for Sir Bradley in team pursuit final as England are forced to settle for silver
Sport
Alistair Brownlee (right) celebrates with his gold medal after winning the men’s triathlon alongside brother Jonny (left), who got silver
England's Jodie Stimpson won the women’s triathlon in the morning
Property search
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

SQL Report Analyst (SSRS, CA, SQL 2012)

£30000 - £38500 Per Annum + 25 days holiday, pension, subsidised restaurant: C...

Application Support Analyst (SQL, Incident Management, SLAs)

£34000 - £37000 Per Annum + excellent benefits: Clearwater People Solutions Lt...

Embedded Software / Firmware Engineer

£40000 - £45000 per annum + Pension, Holiday, Flexi-time: Progressive Recruitm...

Developer - WinForms, C#

£280 - £320 per day: Progressive Recruitment: C#, WinForms, Desktop Developmen...

Day In a Page

Backhanders, bribery and abuses of power have soared in China as economy surges

Bribery and abuses of power soar in China

The bribery is fuelled by the surge in China's economy but the rules of corruption are subtle and unspoken, finds Evan Osnos, as he learns the dark arts from a master
Commonwealth Games 2014: Highland terriers stole the show at the opening ceremony

Highland terriers steal the show at opening ceremony

Gillian Orr explores why a dog loved by film stars and presidents is finally having its day
German art world rocked as artists use renowned fat sculpture to distil schnapps

Brewing the fat from artwork angers widow of sculptor

Part of Joseph Beuys' 1982 sculpture 'Fettecke' used to distil schnapps
BBC's The Secret History of Our Streets reveals a fascinating window into Britain's past

BBC takes viewers back down memory lane

The Secret History of Our Streets, which returns with three films looking at Scottish streets, is the inverse of Benefits Street - delivering warmth instead of cynicism
Joe, film review: Nicolas Cage delivers an astonishing performance in low budget drama

Nicolas Cage shines in low-budget drama Joe

Cage plays an ex-con in David Gordon Green's independent drama, which has been adapted from a novel by Larry Brown
Ford Fiesta is UK's most popular car of all-time, with sales topping 4.1 million since 1976

Fiesta is UK's most popular car of all-time

Sales have topped 4.1 million since 1976. To celebrate this milestone, four Independent writers recall their Fiestas with pride
How to make your own gourmet ice lollies, granitas, slushy cocktails and frozen yoghurt

Make your own ice lollies and frozen yoghurt

Think outside the cool box for this summer's tempting frozen treats
10 best reed diffusers

Heaven scent: 10 best reed diffusers

Keep your rooms smelling summery and fresh with one of these subtle but distinctive home fragrances that’ll last you months
Commonwealth Games 2014: Female boxers set to compete for first time

Female boxers set to compete at Commonwealth Games for first time

There’s no favourites and with no headguards anything could happen
Five things we’ve learned so far about Manchester United under Louis van Gaal

Five things we’ve learned so far about United under Van Gaal

It’s impossible to avoid the impression that the Dutch manager is playing to the gallery a little
Screwing your way to the top? Good for Lana Del Rey for helping kill that myth

Screwing your way to the top?

Good for Lana Del Rey for helping kill that myth, says Grace Dent
Will the young Britons fighting in Syria be allowed to return home and resume their lives?

Will Britons fighting in Syria be able to resume their lives?

Tony Blair's Terrorism Act 2006 has made it an offence to take part in military action abroad with a "political, ideological, religious or racial motive"
Beyoncé poses as Rosie the Riveter, the wartime poster girl who became a feminist pin-up

Beyoncé poses as Rosie the Riveter

The wartime poster girl became the ultimate American symbol of female empowerment
The quest to find the perfect pair of earphones: Are custom, 3D printed earbuds the solution?

The quest to find the perfect pair of earphones

Earphones don't fit properly, offer mediocre audio quality and can even be painful. So the quest to design the perfect pair is music to Seth Stevenson's ears
US Army's shooting star: Lt-Col Steven Cole is the man Hollywood calls when it wants to borrow a tank or check a military uniform

Meet the US Army's shooting star

Lt-Col Steven Cole is the man Hollywood calls when it wants to borrow a tank or check a military uniform