Speaking on MPowered’s The Rate Stuff podcast, Peter Stimson, managing director of mortgages at MPowered, said it was a “pretty bad idea” to tax people on the sale of high-value homes and it would create a “massive cliff-edge in the property market”.
“Any properties at and above that value are just not going to sell and any below that number that can get anywhere near £1.5m are going to sell below value,” Stimson said.
Discussing the idea that there could also be a property tax on homes worth £500,000 or more to replace stamp duty, Matthew Cumber, managing director of Countrywide Surveying Services, said this would drag “the whole of London and the South East” into scope.
Cumber said even at the higher £1.5m threshold, this would still include many family homes in London and not the “exceptionally wealthy”.
He added: “The proposal to tax family homes [an] additional capital gains tax on sale, and if it is still on top of stamp duty as well, this seems highly unfair.
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“Whatever you do, when you mess with the property market and you start putting different taxes and different regulations in, it’s not a good sign for any of us involved in the property market. It will stifle certain areas of the market from moving.”
Stimson said anyone would agree that stamp duty needed reforming and said applying this on the gain of a sale “was not a bad idea in principle” but should be applied across the whole market without an “artificial threshold”.
Cumber said this would impact downsizing as people would stay put instead of selling.
