There has been an increase in landlords putting their properties on the market in central London due to proposed tax increases, it is claimed.
Agents W. A. Ellis has experienced a notable increase on properties coming onto the sales market in recent weeks.
‘What’s interesting is that a number of these properties are from landlords considering a sale in light of the proposed annual tax on properties priced above £2 million owned by non-natural persons,’ said Richard Barber, partner in residential sales at W. A. Ellis.
‘That said, as yet, we have not seen a glut of company owned properties coming to the market, however, there is no doubt that the threat of the new legislation is causing concern to some overseas investors and we have been asked to value some properties currently held in overseas companies while clients decide on their options,’ he explained.
He also pointed out that the proposed ‘Mansion Tax’ from the Liberal Democrats has added fuel to this fire.
‘Our concern is that a marked crack down on foreign investment by increased taxation will be detrimental to the London property market,’ he said.
‘Of course, the Liberal Democrats proposals are not confirmed and the real impact of the Stamp Duty increase and annual tax on properties over £2 million remains to be seen, but in the short term, the supply demand pendulum is swinging in favour of the buyer and we do expect there to be price adjustments as a result,’ he added.
On the lettings side of the market, Lucy Morton, senior partner and head of lettings at W. A. Ellis, said that there have been frenetic levels of enquiries and applicant registrations.
She reports a marked increase in activity between the £1,000 and £2,000 per week enquiries for exceptional two and three bedroom properties.
‘We are noticing more stock being launched to the market, but all good quality properties priced correctly are letting immediately, often with more than one interested party,’ she explained.
‘We are noticing that an increasing number of tenants are more cautious about who their landlord is due to the current financial uncertainty, with some favouring the managed estates such as Cadogan or South Kensington because they want the security of renting a managed property from one of London’s trusted estates,’ she added.