Last week, figures from investment platform Homegrown highlighted how international buyers have been able to cash in on the falling value of the pound since the Brexit vote.
In a speech to the Liberal Democrat party conference in Bournemouth, leader Vince Cable said that much harsher taxes should be charged when property is bought by foreign nationals, in a bid to address the “inequality” in the housing market, arguing that homes are there to be lived in, not to serve as “pieces on a Monopoly board”.
He continued: “To put this right, we must end the stranglehold of oligarchs and speculators in our housing market. I want to see fierce tax penalties on the acquisition of property for investment purposes, by overseas residents. And I want to see rural communities protected from the blight of absentee second home ownership, which devastates local economies and pushes young people away from the places where they grew up.”
Mark Harris, chief executive of SPF Private Clients, said: “I don’t see a need for a further tax on property for foreign investors. However, where a property is left empty, there may be a case for some action but that is not an issue exclusively driven by foreign investors.”
Shaun Church, director of Private Finance said that overseas buyers are a “key component” of the London property market, and noted that a large number of overseas buyers picking up properties had the potential to drive up prices.
He added: “However, imposing a blanket tax on all overseas investors at this politically sensitive time could send the wrong message, particularly if London is to continue as a successful multicultural financial centre.
“The real issue at hand is dissuading investors from purchasing property only to leave it empty for the majority of the year. Regulation to prevent this from happening would ensure property space is being used to its full potential, helping to alleviate the current property shortage.”