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To think new stamp duty is unfair on London AGAIN

(150 Posts)
stupendoushorrendous Thu 04-Dec-14 09:45:21

Aibu to think that the new stamp duty rates will unfairly hit Londoners compared to an equivilent person (in wealth terms) elsewhere.

Example, Family bought their house for say £300k many years ago, value has gone up considerably. If they want to move to a different house of equivilent value they could be subject to over £100K in stamp duty. Their mortage could be doubled simply because they want to move.

Surely, this increase in tax could mean it is impoosible for some Londoners to move locally should they need to.

angelos02 Thu 04-Dec-14 09:47:24

I agree and I don't live any where near London. Also think the term 'mansion' tax is misleading. Conjures up images of Downton Abbey and the reality is that many flats in London cost millions.

angelos02 Thu 04-Dec-14 09:47:48

Wrong thread...sorry

Aeroflotgirl Thu 04-Dec-14 09:50:22

I agree, my mum lives in a small 2.5 bedroom semi detatched house in North West London, and her house is worth £450k its seems awful. Basically anyone living in London and its Suburbs will have to pay Stamp duty, because the house prices are way over inflated for what they are.

LizzieMint Thu 04-Dec-14 09:53:57

According to the bbc example, on a £2.1million property, stamp duty previously would have been £147,000 and will now be £165,750. So it's increased, yes, but it's not by a massive amount compared with the cost of the house. It's no more unfair than it was previously, surely? And a hell of a lot more sensible to graduate it.

LegoAdventCalendar Thu 04-Dec-14 09:54:36

Boohoo! Someone has a million pound house, gained hundreds of thousands of pounds just through being where it is and has to be stamp duty. Diddums.

The stamp duty is lower up to about �900K under the new regime. So, the people affected are going to be quite wealthy. I agree a higher proportion of them are in London than anywhere else.

On a �1.5m property the stamp duty has gone up from �75K to �93.7K

LizzieMint Thu 04-Dec-14 09:56:21

aeroflot, stamp duty previously on your mum's house would have been £13,500 and under new rules would be £12,500.

Bowlersarm Thu 04-Dec-14 09:57:03

Yabu surely. A) Londoners have benefitted hugely and surprisingly with recent price rises and b) it is only when you have a house value of over about £950,000 (sorry don't have the figures to hand) that you start paying more in stamp duty

Handsoff7 Thu 04-Dec-14 09:57:41

So your hypothetical family has received an unearned and untaxed£1.25m, and that we should feel sorry for them that it will be taxed at around 8%.

YABU

MimiSunshine Thu 04-Dec-14 10:00:03

Whether it’s fair or not, London is one city in a whole country. Yes it’s a large city with a lot of homeowners but it’s still only one city so what would be the alternative? Benchmark ‘fair’ against life in London?

But by your example. If you mean by ‘gone up considerably’ that the £300k house bought years ago is now worth over £1m then i’d say out of the profit that homeowner should be able to afford the stamp duty for their new house.

The new stamp duty is tiered by the way. So you don't just pay x% on the cost like you did before, for anyone unsure, this explains it quite simply. The Guardian

stupendoushorrendous Thu 04-Dec-14 10:00:54

Message withdrawn at poster's request.

Chippednailvarnish Thu 04-Dec-14 10:01:04

I think this will actually allow people to artificially increase their house prices, as there will no longer be the £500k celling which a lot of family homes where I live would be marketed under.
This in turn will allow prices to rise even further for properties priced between £250k and £900k.

JackSkellington Thu 04-Dec-14 10:01:34

I simply can't feel sorry for someone living in a house worth £1million+ having to pay more in stamp duty.

allmycats Thu 04-Dec-14 10:01:47

So you think the rest of the country should subsidise people who live in London. Most people will BENEFIT from the change, only properties over circa �995,000 will pay more.

Leviticus Thu 04-Dec-14 10:02:55

No YABU. As PP have said it will be cheaper or the same up to just over 900k.

Anyone buying a million pound house is NOT skint, even in London. It is better for most people, which surely makes it fair.

BarbarianMum Thu 04-Dec-14 10:04:10

Unfair on London again? Because Londoners have the natural right to be that much better off than the rest of the UK's citizens?

Feel free to move to Rotherham and watch the value of your property fall and fall.

stupendoushorrendous Thu 04-Dec-14 10:04:12

Handsoff
"So your hypothetical family has received an unearned and untaxed£1.25m, and that we should feel sorry for them that it will be taxed at around 8%."

No they have not earned 1.25m, they only have access to that money should they want to a)downsize, b) move well out of London

If they want to stay in the area they live in they don't see that money. In addition a tax on that property price will be paid upon death.

TheChandler Thu 04-Dec-14 10:05:39

You know, I wish the government would just stop, or at least think more seriously, about constantly fiddling about with and changing things, just to get political headlines. Can't we have any certainty about what tax rates we (as a country) are paying? I'm sure in other countries the government doesn't change things so much (except in tinpot dictatorships).

stupendoushorrendous Thu 04-Dec-14 10:06:31

Barbarianmum

"Unfair on London again? Because Londoners have the natural right to be that much better off than the rest of the UK's citizens?"

You're joking right? Londoners are being forced out of the city they grew up in because it's unaffordable for them.

OnIlkleyMoorBahTwat Thu 04-Dec-14 10:07:04

Here we go, the usual 'people who have over a million in housing equity are not rich' moaning.

Yes you bloody are, compared with 99%* of the population.

Taxation policies that take the biggest percentage from the richest people are much fairer than those that take the same percentage from everyone. Other taxes like VAT and Council Tax take a much greater percentage of a poor person's income than a rich person's.

The old stamp duty system was flawed and under the new system only the 2% most expensive properties will pay more.

* I don't know what the actual percentage, but it is something of this order.

Leviticus Thu 04-Dec-14 10:07:41

Stupendous people can't always afford to live in the area they want.

Unless your neighbour is looking at a £1 million house she is no worse off and if she is I would hardly compare her 'plight' to that of a poor pensioner anywhere.

MidniteScribbler Thu 04-Dec-14 10:07:47

Boohoo! Someone has a million pound house, gained hundreds of thousands of pounds just through being where it is and has to be stamp duty. Diddums.

Jealousy is an ugly trait.

DidoTheDodo Thu 04-Dec-14 10:08:09

Nope, I'm OK with the new rules. I work in London but live 50 miles away so I can afford a house. Any house. It's an alternative.

irregularegular Thu 04-Dec-14 10:08:24

You only pay significantly more stamp duty over about 1.2million. A little bit more in a small window below £1million, but then less again above.

Sorry, but even the working class widow in London has other options if her house is worth £1.2 million.

Of course, you may be saying it was too high before, which may be true - though the thing about living in an expensive area is if you do want to release some capital (eg to pay stamp duty) then you only have to downsize a little to save a lot.

I still don't like stamp duty as it is a tax on mobility. A tax on owning the house would be fairer and less distortionary than a tax on moving (but probably more expensive to collect). But at least this has got rid of the silly distortions around the cut-off points.

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