'Mansion tax' - what if you just can't pay it?

[shellinthesea]

My elderly mum lives in a London house worth about 2million. She's been there for over 50 years, and is physically and mentally fragile. There is no way she would EVER want to move, the house and her neighbours are her whole world. She has no spare money - at all. (Neither do I, before anyone suggests this!) How is she supposed to manage this? It's not exactly her fault that the value of the property increased so much since my parents bought it all that time ago.

I also have a friend, also in London. Both parents sadly died in an accident about 15 years ago, and she used her inheritance to buy a family home which has also increased massively in value. It's probably also worth over 2 million now! She's a single mum on a lower income with 3 kids who very happy at their local school and within their community - what's she supposed to do?

It's just not as simple as 'you live in a high-value house, you can obviously afford to pay several grand a year' as RR seems to think. And for anyone who is about to say 'oh tiny violin, their houses are worth two million' - both of these situations are complicated and quite sad in many ways. Neither my mum nor my friend can simply just sell up and move...anyone have any thoughts on this?

If your mother really is that fragile now she would probably be better off in a retirement or care home by 2028 so she won't have to pay anything.

Just like those on benefits or having more children and expecting the tax payers to fund their lifestyles- if you can’t afford it move somewhere you can afford, don’t have more children.

l’m sick of working to pay for others, I didn’t have another child as I couldn’t afford to, so why should I pay for others to have more??

and those who have sadly become unemployed/ ill etc, yes we feel sorry for them, but if you have no sympathy and believe those being forced out of their only home is tough, then the same can be applied in this case.

its become a land of envy and ill feeling. I was the kid who did good, and now I am being punished.

this WILL push house prices up.

People who used to be able to buy in a price bracket 1.5-2m will think twice before doing so. People who own 2m+ properties and can't afford tax, like in OP's examples, will try to downsize. So instead of moving up the ladder more people will chase the same pool of properties.

I understand that for people living in lower cost areas 2m+ property seems like owning an island, but 1.5m in London will only buy you a very average 3 bed semi, not mansion at all.

Indeed!

just wow!

by the same logic - those who need child benefit cap lifter would be better off sterilised?

if you can’t afford it move somewhere you can afford, don’t have more children.

that message has got through loud and clear, look at birth rates!

OP has explained why.

@nearlylovemyusername there isn’t a child benefit cap? And child benefit used to be universal….

not pensioners exactly.

this was posted on a parallel thread:

https://www.mirror.co.uk/news/politics/skint-pregnant-mum-four-budget-36309267?int_source=breaking-news

this woman will now get 10k pa extra.
These are those 10k which OP's Mum and friend and two other home owners like them need to pay now.

I think it’s massively unfair in these circumstances especially. She has earned her right to stay in her property, it’s hers and this ridiculous government have no right to force her out.
Council tax is not fit for today and was brought in badly anyway.
For those properties in bands F, G and H who are being reviewed it’s ridiculously unfair, should be the whole system reviewed.
an example being my friend lives in a small converted barn, it’s actually a terraced property. It’s one of 5, they are all banded as an F, and therefore subject to a review according to the budget.
the farmhouse which is a large, extended, detached property and ( worth twice the amount of the terraced properties) is banded as E and therefore not subject to a review.
how is that fair?? It’s worth well over £1m

Oh this is too funny. Just in case you’re not parodying anyone, I’ll bite.

My parents were young teachers who bought a 3 bed house in the early 60s for 3,000. Before I was born they moved again and in the 80s when they were both made Heads of Department at the same time we moved into a lovely 5 bed Victorian home.They had been able to give us a comfortable life while saving towards this last house and on their salaries then they were able to increase the mortgage.

They didn’t buy well or have any foresight whatsoever. They lived in different times when housing was readily available and largely met the needs of the population and when professions such as teaching, medicine, local solicitor, pretty much guaranteed a comfortable standard of living. There is no way on earth two Heads of Department could afford to buy that last house now on salaries alone. It would be way out of reach of the majority of professionals.
This story is repeated over and over.

apparently it didn't. Otherwise there wouldn't be a need to lift CB cap

I understand that for people living in lower cost areas 2m+ property seems like owning an island, but 1.5m in London will only buy you a very average 3 bed semi, not mansion at all

Why are you referencing 1.5m when this is about 2m houses? Plus 1.5m will get you more than an average 3 bed in many parts of London.

@nearlylovemyusername sorry you are arguing birth rates haven’t fallen?!

I am guessing you don’t have to look after any elderly relatives otherwise you’d have a bit more insight into how incredibly disruptive a big move can be and how difficult it can be to persuade them to do so. Maybe a bit of compassion wouldn’t go amiss?

Well in my area of London you can buy a nice 3 bed 1930s terrace for about £650k. I just looked on Rightmive and you can get a luxury 4 bed balcony flat in Weatminster for £1.5mln. I mean maybe if you live in Chelsea or Kew or knightsbridge you couldn't get much for that j suppose but boohoo.

So many people in the 60's and more so the 70's had the foresight to buy well. Why don't people, especially the young, have that sort of foresight and dare I say fibre nowadays to jump on opportunities ?

Absolute nonsense & of course salary vs house price ratios haven’t changed at all.

My parents buying in a crappy part of London that underwent mega gentrification didn’t have anymore foresight than someone buying outside of London.

I know - some of the comments here are so spiteful towards elderly people.

which area of London for 650k?

Re Westminster - did you mean this?
4 bedroom apartment for sale in Marsham Street, Westminster, London, SW1P

Service charge for this flat is over 15k pa. Any significant maintenance to the building, e.g. lift replacement, will be on the top of service charge. It's not selling if you noticed

Normally I would agree any tax like this just for being seemingly rich is unfair however 2 million (I’m assuming mortgage free from what you’re saying) is a literal fortune! Like a huge huge amount! You could live up north in a monstrous house for 800k and have 1.2 mill earning you a fortune in interest and not have to pay mansion tax. I appreciate that they probably would never move north however I just wanted to point out that sitting on 2 million pounds but living hand to mouth is ridiculous in my opinion. So much so that I don’t think the mansion tax is the biggest problem they have.

There's such a cruelty to it. I see that a lot around my area (where I'm lucky enough to rent a bit of a shack!) Elderly people who've lived there for decades from the days that the area was downmarket, they have such deep roots in the neighbourhood and are part of its history really. Then the rich trendy set effectively decide it's now the fashionable place to be, drive the prices up, and the elderly residents have to move out to make way. It's cruel.

Lewisham. A not especially fancy part!

they did fall amongst population who are making responsible choices.
Those who need CB to lift them out of poverty - unfortunately not, they continue breeding. Look at the link above. It was posted on another thread, I copied it here

Jesus "breeding"? Is that really the word you're choosing here?

I don’t think the comments are being spiteful towards the elderly but the picture being painted by the OP of a poor old lady being forced out of her home, when the elderly lady doesn’t need to be concerned about this at all as it will come out of her estate - either by delayed charge, equity release or whatever. Those concerned for their parents are actually concerned for a reduction in their own inheritance.

I don’t have strong feelings about the tax. It’s certainly not the worst but I do have some sympathy for those who have stretched to buy the very best home they can afford which used to be what we were told to do (nothing like a luxury mansion in most parts of London!) and now find they need to find another couple of hundred a month. I do hope it has a bit of a dampening effect on house prices though.

I do object to people disguising their inheritance concerns with the fictitious accounts of people being forced to sell up.