Quote serial thriller at 23 Nov 2014 5.53pm

I reckon coming up to the General Election, housing is going to be a major topic of discussion. UKIP will frame it around over-population and thus immigration, Labour have claimed they will build a couple of hundred thousand houses by 2020, but actually I think the most interesting thing happening to combat the inflation of the cost of the property market is the grassroots stuff in London at the moment.

I've referenced it a few times on here but have only recently realised how important a movement it is when you consider how much cynicism there is towards any form of collective activism. Be it the student protests or unions striking, there is a general belief that a) they don't achieve their aims and b) they are ideologically misguided.

So these (admittedly small) victories for people coming together against property investors and landlords should act as an interesting rebuttal to that first claim...

The E15 mums: [Link]

and more recently, a great video highlighting the lack of democratic representation these private firms possess in regards to the New Era estate: [Link]

The gentrification of London is not new, but I think people are waking up to the damaging and divisive effect it has on the least powerful in our society.

So my question to everyone is, do you agree with what these people are doing? And if you do, what distinguishes this from the student movement or the union protests?

Quote OknotOK at 04 Dec 2014 10.28am

It is a decent change but the amount you have chosen is the most disingenuous way of promoting the policy? £500k - as the boundary for the slab rate increase - is the biggest change. The savings at £499,999 are about £20.

No one can argue that stamp duty needed changing and the move to a standard graduated taxation is massively welcome. But mainly because it will prevent major distortions in the housing market rather than any huge tax saving.

Total net revenue to the exchequer will be only £700m lower I think, but the high value properties that would result in paying more tax represented c. 1.7% of property transactions last year and even then many of those will have been bought through companies and therefore not covered by the current rules.

Interesting that the key note items from Osborne's speech yesterday were centrist/populist. Moving away from the right - increasing taxes on the "wealthy" and further hits to the banks.

Quote OknotOK at 04 Dec 2014 12.17pm

I'm not denying savings, I'm just saying they are much smaller just below the previous slab rates.

So if you were buying a house for £499,999 then under the old system you would have paid £14,999.97. Under the new system you would pay £14,999.95. So a saving of 2p

Just above the slab rate (i.e. a purchase of £500,001) and your saving is vastly more. You would pay £15,000.05 compared to £20,000.04 at the old rate.

Savings are there but the amount you save is massively increased if you are paying just above the old rate boundaries. Hence why the example given (and the HMT examples provided) aren't a fair representation. They all just happen to be not much above one of those boundaries.

I'm not convinced many sales happened just above those rate boundaries either. Precisely because those boundaries existed.

So when I sold my last flat it was valued at £250k. No one was going to pay £255k because it would have meant a massive increase in the stamp duty. So they only started paying over £250k when it was valued at closer to £275k.

Admittedly I haven't seen the data though so don't know what % of transactions were just above those previous boundaries.

Bloody hell I am about to start using charts again. I hope Johnny Eagles isn't reading this thread I'm quite lucky the Spectator has done this chart. As otherwise I would have had to attached my own one that I did yesterday

[Link]

I should say I absolutely support the change. I just think it needs to be explained fairly.

Edited by OknotOK (04 Dec 2014 12.25pm)

Quote Stuk at 04 Dec 2014 12.33pm
You're right actually, but that one price does seem the very worst case example. They've presumably done it to stop people keeping prices artificially just under the thresholds. I'm sure there must've been many deals where it was worth more (sold for more) but the "extra" above the threshold was paid in one form or another, off the record.