Written on 9 December 2019 by Giles Cook in Property News
The three main political parties have included a stamp duty levy for overseas buyers in their general election manifestos.
Non-UK residents buying properties in England will pay an extra 3% in stamp duty, if the Conservatives win the election – more than the 1% levy proposed a year ago.
The party says that the increase will help prevent spiralling property prices, enabling more people to get on the housing ladder. The revenue would be used to help tackle homelessness.
Labour would introduce a much higher, 20% levy, but on overseas companies and trusts, rather than individuals. The Liberal Democrats have also included a stamp duty surcharge for foreign buyers in their manifesto.
According to the Conservatives, 13% of homes in London were bought by overseas buyers between 2014 and 2016. In addition to pushing up prices of prime property, it is believed that a ‘trickle-down effect’ has an impact on cheaper properties and those outside London
In February the government began consulting on a 1% stamp duty levy for non-residents. London Mayor, Sadiq Khan claimed this figure was too low, citing Vancouver and Singapore, which have a 20% surcharge.
The new 3% levy would be paid in addition to other stamp duty charges and would raise an estimated £120 million for programmes tackling rough sleeping.
Chief Secretary to the Treasury, Rishi Sunak said: “Evidence shows that by adding significant amounts of demand to limited housing supply, purchases by non-residents inflate house prices.
“The steps we are taking will ensure that more people have the opportunity of a great place to live and build a family.”
Labour would also tax second properties, used as holiday homes, to help deal with homelessness. The Lib Dems would give local authorities powers to increase council taxes by up to 500% on second homes in an effort to free up vacant properties.
All three main parties in England promise action to improve tenants’ rights, with longer tenancies or moves to end no-fault evictions.
Both Labour and the Conservatives want to ban the sale of new leasehold homes. Labour would allow existing leaseholders to buy their freehold ‘at a price they can afford’.
Read more about the stamp duty increase for foreign buyers on the BBC website.
