Tax rises on high-value properties, along with the prospect of a “mansion tax” and the uncertainty caused by a looming general election, have made homes that are worth more than £2 million ($3.24 million) much harder to sell, according to research for the Financial Times.
More than half of all properties in London’s most expensive central areas have been withdrawn unsold in the six months to the end of June, the research by the property data company Lonres and analysts Dataloft shows.
Since March 2012, buyers of homes worth more than £2m have been charged 7 per cent stamp duty. Those buying houses worth less than £125,000 pay no stamp duty, while purchasers of properties worth between £125,000 and £2m pay a sliding scale of between 1 and 5 per cent.
Before the top rate was introduced, between 20 and 30 per cent of £2m-plus homes on the market in London’s most expensive central areas were withdrawn unsold. That proportion rose after the new stamp duty band was brought in, with the trend intensifying this year.