to be pleased my property portfolio won't incur a mansion tax?

[AlphaBravoHenryFoxtons]

The portfolio consists of five London flats worth between £1.4M and £1.9M, three London houses worth 1.5M - £1.9M, and an actual mansion in the north worth £850,000 (with tennis court, its own orchard and some topiary on the front lawn in the shape of a giant socialist clenched fist).

The point is there will be one class of people who own property over £2m paying mansion tax and another class of persons who own property over £2M who aren't required to pay.

Yes but I don't think many people will have be sorry for those that 'only' have one property worth £2m+ and therefore have to pay taxes that others will lots of property might not.

There are far more injustices in this world to complain about imo than your wallet being too small for your twenties and your diamond shoes being too tight.

Look I should point out I don't actually own a portfolio of high end homes. Nor do I have any socialist topiary on my front lawn. (Nor a tennis court or orchard.)

This is just a theoretical discussion about the crude application of the mansion tax policy. I know you all think it will never apply to you, but it will. It will eventually become a tax on a family home: "You can afford a family home, there take that levy you bounder, because we can." They'll fiddle with it, and lower the thresholds, until it applies to more and more households.

If your property portfolio actually existed, it would be only a matter of time before it attracted tax as its value would be steadily rising, so all this would even out in the end.

A £2M property in the SE and London isn't necessarily anything special. And some households buying into that market are very heavily mortgaged.

Is it fair that someone with a £800,000 mortgage on a £2M property pays a mansion tax when someone with £1.5M equity on a £1.6M property pays none. (For those not good at maths the former has three hundred thousand less equity than the latter .)

VoyageofDad the whole point is that your family home is not " earning" money. It does not issue you a pay check at the end of the month. It only generates cash if you sell and only then if you downgrade/downsize.

This is a tax which would change the entire principle of taxation, from a revenue/income tax to a wealth tax. Do people really think the band would move in line with house price inflation? No. In time most people will end up paying it. Then what is to stop a wealth tax on your bank balance, or your fancy car or anything else that can be taxed, simply because you own it.

How will they judge along a street which houses are improved and therefore more than 2 mill and those that are not? If Zoopla suddenly posts your property as more than 2mill will HMRC come knocking? A valuation exercise would be intrusive and costly.

PS. My house is worth nothing like 2 mill. I just believe this is a bad policy based on the politics of envy.

If someone could afford to buy a £2m house, they are rich.

So if the tax was levied on what the current owners actually paid for their house, it would be much fairer.

But either way, it's an additional tax on London. Ordinary terraced houses in zone 2 are breaking through the £1m mark. So another thing to make it fairer would be for the revenue raised to remain in its region.

Around here there are plenty of houses worth 2 m (not mine!) and occupied by old people often living in one or two rooms with a lifetime of collections, clothes etc and they are of an age where sorting through it all is somehting impossible to undertake.

My DH lives in a house in London worth about 1.5, however its a hoarders house, you literally cannot get through the front door. The bath is piled up with old newspapers, clothes from years ago. We have offered to help him get at least a few rooms back to normal. He refuses. He will fall down the stairs one day and no one will know.

He refuses to get a emergency call pendant, costs too much. He is a complete nightmare to be around. Although his is an extreme case there are plenty of older people who live like this

AlphaFoxtrot "How anyone can afford NOT to be a second or third home owner us beyond me."

You don't think that is insensitive when huge swathes of people struggle to afford a primary home? Really?

I understand the nature of what you are saying re the 'mansion tax' but really

It's just an extension of the same principles used for Council Tax though innit.
Good wholesome Tory policy.

EdithWeston "If someone could afford to buy a £2m house, they are rich.
So if the tax was levied on what the current owners actually paid for their house, it would be much fairer."

Really? But is someone who pays £2M for a house with a £800K mortgage, richer than someone who pays £1.9M for a house but doesn't have a mortgage?

I would think it would result in a lot of houses being nominally broken into flats.

I know the mansion tax is putting a lot of people off voting Labour. And not because they own mansions.

I must say I couldn't shed any tears for people who can afford to live in a home worth £2m. It wouldn't worry me too much if it was brought in.

This is how they get away with putting crappy non-sensical policy through, because half the people think "meh, doesn't affect me anyway" and the other half think "well if they can live in a £2m house they can afford the tax anyway".

Can people not see its just a policy plucked out of the air in the hopes it will appeal to the struggling working class who have their pitch forks pointed at those evil bankers?

Obviously its morally right that people who have more pay more. But I don't think someone who has a house valued at £2m always does have more than someone whos is valued at £1.99m.

Either put up council tax and make the bands fairer and have that as a property tax, or change stamp duty, or have a land value tax, or have a progressive property ownership tax that starts as pennies at the bottom and works its way up.

And for the record, I've just sold my family home for £83,000, so i'm probably what you'd class as the bottom of the pile but even I can see the stupidity and unfairness in this tax. Its just a way for them to answer the "well how are you going to pay for that?" questions without pissing off the majority of the country. Oh great, won't affect me, those lovely labour folks always looking after the working man!

Its not well thought out, It would largely affect people in London and the SE. There would be exceptions so those exceptions wouldnt fund all the spending of Ed Balls. The bankers bonus tax will drive people out of the country. So, where are Labour going to get their money from then to spend spend spend....

I would like to see more tax charged on people who are buying in London for investment and not living there. Houses and luxury flats empty. What about a tax on this element.

I would also limit CB to no more then 2, I would say if you are want more, have a birth control accident etc you will need to squeeze another child in with your existing children and the state shouldnt be giving larger houses and more benefits the more kids you have.

Take some personal responsibility for your own lives and then the benefits left can be given to the people who really need it (not just the ones who have made the lifestyle choice for whatever reason!)

It's just a cut off point in the same way the council tax was worked out. Lots of Londoners in council tax band C properties - which are now probably worth more than a G band property elsewhere, I know our old flat is- are paying lots less in CTax than other people.

If you are very heavily mortgaged you should consider buying something you can afford.

"Really? But is someone who pays £2M for a house with a £800K mortgage, richer than someone who pays £1.9M for a house but doesn't have a mortgage?"

Not necessarily. I was making a point about whether the person was currently wealthy enough to finance the purchase (as opposed to someone who just happens to have had a family home for a few decades in a place that has boomed out of all proportion to their earning power). Not a point about whether people of a particular income level can or should buy properties of a particular price.

Anyone over a certain level is rich. If they choose to buy highly taxed items, it's up to them.

Basing a tax on a price tag that person could never have afforded is far less fair. Well, to me anyway.

What if you have say 15k income having retired on the state pension and a private pension? But you live in a house you brought years ago that is now worth 2m. Are you suggesting that you force that person to move?

Really?

Surely it's a blanket policy/cut off because it would be prohibitively expensive and complicated to administer if there were loads of regional/postcode/no of properties/improvements made or whatever categories to subdivide properties and values into?

Not saying it makes sense in every individual case, but more that I can see the reasoning behind it from a policy point of view. Same as the child benefit cut off thing (single earners over the threshold losing it whilst families with 2 earners just under but with a family income way above kept it).

Surely it's a blanket policy/cut off because it would be prohibitively expensive and complicated to administer if there were loads of regional/postcode/no of properties/improvements made or whatever categories to subdivide properties and values into?

Well then I'd rather if it can't be done right and fairly its not done at all. Or they could just use the last sold valuation or last valuation for mortgage purposes? That wouldn't have much effect of the market, and seems a much fairer way of judging how well off someone is by the value of their property.

1.It is very very popular by the way>I might not like it because I have no savings and only a house and have no equity in the house except what came out of income worked very very hard for and taxed at 40%+ and because I chose to house my children on my divorce with a £1.3m mortgage and their chose to have a lot of savings and a slightly smaller house and lots of free time and money to spend. It's pernicious a tax but very popular.

1. Those who like it who are home owners don't forget that ATED - the annual tax on residential properties owned by a company brought in by the Coalition started at £2m properties and is now coming down to £500k so if you think the mansion tax is fine because it only applies at £2m beware. It will be down to the £500k jobs before you know it.

1. If I am obliged to pay to pay it then I will make sure I pay a lot less tax than I currently do. There are a whole host of lawful things lots of other people do to pay less tax like pension contributions which I have not bothered with. If this mansion tax comes in I will be delighted to ensure the state receives at least 4x the cost of my mansion tax less from me in tax every year because the state will have shot itself in the foot and lost my buy in to this country and it's welfare state. The state and the poor will suffer.

1. Someone said your house goes up more than the tax each year. In the last 6 months my house and man in London has gone down 0.6% and that is increasing. If they tax you because in one year you are £2.1m and then that year the value drops to £1.8m I bet they will not be issuing refunds!

1. It taxes young people in London unfairly - you might have to live near work and both work and your childcare costs are £30k a year yet you will not be able to put off the tax until you die as the old are allowed to do with low incomes because the state will take no account of your £1m+ mortgage interest costs nor your £30k a year childcare bills.

Ways to avoid - we don't know yet. I certainly don't spend on the house so we are like the example above a road where some houses look like from films with things like new furniture and pools and others like ours have second hand furniture and no not antiques and the like. Secondly granting a long lease over the property to an adult child will reduce the value right down. Thirdly yes splitting into two as two council taxes will be less than paying one mansion tax. Fourthly commercial property is not taxed so many large homes country houses and perhaps even those like mine and myf ather's used for work and home purposes for decades may come within those exclusions.

However the best way to avoid it is to vote Tory or SNP (or in Labour areas UKIP).

Secondly granting a long lease over the property to an adult child will reduce the value right down.

Never even thought of this! And with all due respect i'm assuming your not a property solicitor? I bet any decent one could think of 100 ways in wich to devalue your property. Not that normal working families are likely to do so but I bet the "steriotypical" high flying foreign investors people love to think this tax will hit already have loopholes to avoid it.

It doesn't appeal to me.

A tax on flats and houses that are empty most or all of the year in areas of high housing need? Yes please.
Looking at the loopholes that allow people to evade stamp duty? Sounds like a good plan.
Laws that give tenants more rights, and a requirement for every new development to include some truly affordable housing, and no more 'poor doors'. Go on.
I'm even tentatively in favour of giving squatters a few more rights, and wouldn't be against an even bigger stamp duty increase at the super-high end.

But chucking a random figure in the picture with no thought to fairly obvious issues of equity/length of ownership... just seems dumb.

(Lawyer but not property one)
Of course they have not written the rules yet - they might include anti-avoidance provisions about dividing houses into two even if it's a proper conversion and granny has her proper granny flat. They say in the legislation the long lease idea isn't allowed and that running your business from home is different from paying visitors to Longleat - who knows. We shall have to wait and see.

Rich twat.

Sorry, I can't be bothered to give your thread any more thought than that.