United Kingdom Property News

U.K. high-price homes tax slows London growth

U.K. high-price homes tax slows London growth
London luxury-home price gains have suffered in the wake of the government’s tax hike according to leading consultancy Knight Frank.

Although prices for residences costing £3.7 million and over rose 10.7% year-on-year in May, this was the smallest gain since August 2011.

Month-on-month prices climbed 0.7%.

In March, Chancellor George Osborne had raised the stamp duty for house purchases above £2 million to 7% from 5%.

Liam Bailey, Knight Frank’s head of residential research, said: "The market has absorbed the 7 percent duty rate fairly well.”

Bailey added that the continuing European debt-crisis has seen a surge of interest from continental investors. "We are now seeing a noticeable uptick in interest from France, Italy, Spain and even German-based purchasers," added Bailey.