It’s the end of the year again (it comes around so fast). Here’s our take on 2014’s main industry news…
It’s that time of year again, so get ready for the plethora of ‘year in review’ articles blocking up your social media timelines.
However, we couldn’t resist, primarily because it’s been such an eventful year in property. What with mansion taxes, stamp duty changes and the ongoing debate about just how much property will continue to rise in price; there’s so much to debate and discuss when it comes to the industry.
Here’s a brief rundown of 2014’s major property news…
March: Budget time
The start of the year’s usually quiet until March, when the Chancellor gets out his briefcase to tell us what’s on the cards this year in terms of tax giveaways and other economic policies. In his Budget he extended the application of the annual tax on residential properties held by corporate vehicles and the CGT charge, meaning that from April 2015 they will apply to properties worth more than £1m and, from April 2016, to properties worth more than £500,000.
As well as this, the 15% rate of Stamp Duty Land Tax will apply on the acquisition of interest valued at over £500,000 in UK residential property purchased by a partnership, or a collective investment scheme both on and offshore. This will not apply when the property is acquired for the purpose of a property development business, letting to third parties on a commercial basis or a property trading business.
The Chancellor also said that the Help to Buy equity scheme for first and second time buyers will be extended to 2020 and that support will be available for the building of more than 200,000 new homes. A new garden city at Ebbsfleet in Kent will also be constructed.
September: Scotland says no
To relief all-round (well, at least here in England) Scotland voted to stay in the Union after a very close vote. So no sterling crashes or major businesses relocating to London! The situation is still not entirely clear, so we’ll have to wait it out and see how the tricky devolution question is handled. Meanwhile, here’s our view on the subject.
October: Mansion tax
As expected, Labour’s Shadow Chancellor Ed Balls announced that if his party get into power next year, a mansion tax will be introduced on those who own properties worth £2m plus. Despite massive gaping holes in the policy, Labour’s determined to press ahead with this rather illogical levy. As you’ve probably deduced, we’re not fans – you can read why here.
December: Autumn Statement
In his Autumn Statement, Chancellor George Osborne announced that the stamp duty levy will be reformed. This is good news for 98% of homebuyers, although not so great for those with properties worth more than £937,500, who have seen their tax bill rise sharply if they’ve sold after 3 December. You can read more about the new rates and what we had to say about it here.
In other news, The Bank of England maintained its 7:2 split on the vote regarding interest rate rises being kept at a record low of 0.5% on 17 December. Members of the nine-strong committee noted wage growth would have to accelerate to be consistent with the 2% target for annual UK consumer prices index inflation set by the Treasury. So despite external MPC members Martin Weale and Ian McCafferty pushing for a quarter-point rise, it seems there have been no rate rises this year.
So there’s our year in review. Keep a look-out for our take on what we think 2015’s set to bring when it comes to property. And have a fantastic Yuletide!