To think that the new tax on £2m will eventually be harmful to ordinary folk?

[IwishIcouldski]

I'm concerned that the new tax on properties over £2 million will push more buyers toward homes below that threshold. Increased demand at lower price points could intensify competition at £1.5 million, £1 million, £500,000, £300,000, and so on, as buyers adjust their expectations downward in response to pressure higher up the market but still below the £2 million mark.

It also raises the question of who will actually buy the £2 million-plus homes. I can imagine many sellers pricing their properties just under £2 million to attract buyers, which could drive prices down at each prove level across the market. Meanwhile, some of the remaining £2 million homes may end up being purchased by the very wealthy or by landlords who convert them into multiple flats. There may need to be big drops in prices because when you buy, you would not want to be dragged into the £2m mark after a couple of years because of inflation.

I feel it will eventually harm ordinary people over time but the wealthy will be able to weather the storm.

There 10 homes over 2 million in my area. So no. It’s not going to clog the housing market up.

Cant believe people are whinging about having a 2mollion pound house. I’d love this problem.

I'd say that this is purely a London and South East issue. The rest of the country simply won't be affected, or concerned. Won't affect how many will vote where I live, (an ABC1 demographic), but the continual lying by this completely incompetent administration will.

Sorry replied to you on the wrong post.

You say your parents house is worth £1m - so this doesn't affect them.

There is a reason the tax was set at £2m because that's a different thing entirely.

Many people have done well with the rise in property prices as your parents have done & many houses in London are around the £1m mark but that is not £2m.

Your post is irrelevant to this except that it illustrates perfectly how hard it is for young people in London to get on the property ladder & how many people will do well out of inheritance one day.

I’m sure PP will do well when they do eventually inherit, but no doubt at that point they’ll kick off about IHT and claim their parents ’worked hard’ to buy their home, not that 90% of the value was purely an as-yet untaxed windfall thanks to market forces.

Schroedinger’s pensioners: Slogged to pay off every penny of their £1 million house while buying it for £16K.

If a small tax on a bit house is harmful to ordinary folk we have a lot more to worry about than we do now.

No it will be fine for ordinary folk. And might slow down people’s obsession about house prices, once they have got this announcement out of their system.

Ordinary folk need house prices to come down not up.

As another poster said, this will just be the start. If you think this will only be on expensive houses, I think you’re wrong. This is the start of revaluing all properties and upping tax on them to generate more revenue. Eventually we will all end up paying more.

Here’s me being cheerful about raise in the minimum wage because I might finally be able to buy some new socks!!

When you punitively tax the “super rich” they change their behaviour; they might leave the country, not bother investing in a new businesses, create fewer jobs and so there is less wealth overall. So no, it’s not a good thing.
Look into countries that have tried taxing wealth. Most have reversed it.

No, I think anything that suppresses house prices is an excellent idea.

??? Average price of a home in the U.K. is £272k. No it won’t affect norm people but will affect those with huge unearned wealth tied up in their house because they bought at normal prices in the 1980’s

My house is worth about 2.3m. I’m very pissed off about the tax. But the reality is that it’s £210 a month. We can afford that without loosing sleep over it and I suspect most of our neighbours can too.

I thought you didn't have to pay the annual charge till you sold? Thats not really a big chunk out of a 2 million+ sale price. It'll just get factored into sales prices surely. If I was buying a 2 million quid home I'd just offer £25k or £50k less to account for maybe 10 or 20 years of charges? 😅 Hardly going to crash the market is it...

Any old excuse from the wealthy to avoid paying their way and reducing their power and inequality, isnt it.

Class warfare is very much a thing in Britain, dating right back to the1066 conquest. It’s made up of the rich trying to take more and yet more and wipe their feet on the lower classes.

Be warned, civilizations cannot take constant internal warfare, and it bites all levels of society eventually. Civilization after civilization have failed because the rich sucked all the wealth and power out, leaving no resources in the public system. Britain is well on the way to that.

A lot of unearned wealth amongst housing stock with south east and London
market needs to be buoyant in order to grow sector
at the moment it seems to be going sideways with inflation eating into prices which is not good for market confidence
labour need a buoyant market in order to build Angela’s 1.5 m homes as developers will not build without a route to sale
what the country needs is to stop wasting money ( foreign aid , taxis for Asylum hotels etc etc ) and get more people working earning money and paying taxes
This will not help the housing market

No.

They was they are doing this isn't going to be based on an estate agents valuation in the future. It will be based on a valuation made by the government in 2026.

Thus houses won't devalue as such - because they will be designated as a mansion or not a mansion.

What will happen is anyone who has a house on the borderline of £2million will have the incentive to challenge whether it's a mansion or not - and many people with a house that size will have sufficient funds to do this via legal channels. It's the single pensioners with little income who have lived in a house for decades who won't have the means to do so. Or the farmers who have to live on a large plot of land because that's literally their business to do so (so effectively get taxed for council, business AND mansion for the same thing). The actual rich people will be more likely to find a way to dodge it. It will also be costly for government to deal with said legal challenges.

What I can see happening though is the designation of mansion changing in a slippery slope manner where £1.5million properties get sucked in further down the road as the government assess there won't be enough protesting to stop this.

It should be levied on total property wealth, not just on your single residence that you actually live in full time.

Family A - has one property they bought for £1m with a large mortgage. Improved it significantly and now it’s worth £2M. They live in it. They pay the tax.

Family B - bought 3 properties for £1m. Total mortgage borrowing the same but they rent out 1 property for as much rent as they can and they spend as little as possible on the rental property. The 3rd property is a holiday home for them which they also rent out for some of the year. The total value of their properties is greater than £2M, and they have rental income. But they will not pay the tax as no property is over £2M. Their property wealth is far greater than family A but they don’t pay the tax.

Rachel Reeves has significant personal property wealth and multiple properties but won’t pay the tax personally as none of her properties are over £2M.

If they are going to introduce a property tax, at least do it properly!

This is a genuine concern for somewhere like London, where very average properties and flats sell for 1 million, it won’t take long for this to be 2 million, particularly as those selling 2 million properties are like to adjust their prices downwards to encourages viewers. If you voted for Labour, this is the reward you reap, growth stagnation.

It's based on existing council tax bands isn't it?
I don't think people are going around deciding what is a "Mansion" and what isn't.

The term "mansion tax" was just coined by the press.

Stop with this nonsense.

It's set at £2m not £1m & there is no suggestion that it will change. That's just scare mongering.

House prices in London are ridiculous.

My kids who were born & brought up here & their friends face a very different prospect when it comes to buying than me & their father did twenty odd years ago.

Stop painting this tax like it's a terrible thing. It's not at all.

Unintended consequences

• less spend on home improvements in some areas for fear off breaching the £2M level in the future (which will be reduced) - affecting normal folk providing these services
• if they are on a fixed income and disposable cash is an issue there will be less spending in their local environment …. Not going to lunch in their local cafes, restaurants etc … affecting normal folk providing these services

What rubbish.
As if someone in a house worth just under £2m is going to let it go to rack & ruin for fear of paying an extra couple of hundred quid a month!

Get some perspective here. What salaries do you think people in these houses are on?

Average properties and flats only go for those sorts of prices in places like Westminster, Bloomsbury, Kensington and Knightsbridge, and are not going to double in value overnight. It really is not going to have much effect in the rest of the country or even the rest of London.

For as long as people think that wealth causes poverty, more poverty will ensue.

I found this post quite fascinating and it prompted a bit of research, so, in our part of the country, the north east, I did a quick rightmove search for properties within a 30 mile radius of where we are, after ignoring all the portfolios of flats , multipe houses etc, it came up with just 20 properties that would be classed as a home, so I really don’t think it’s going tohave any significant impact, it’s a sad reflection on the inequality in the UK when most of those were pretty massive houses in acres of land as opposed to a terrace in London( ok terrace might be exaggerating), shows why we could never move south even if we wanted to

How is owning a house you paid for with your own money you earned "taking" anything from anyone? Without property rights we will quickly be a very poor country indeed.