Tag Archives: finance
Average home buyer £4,500 better off in England and Wales since tax change
The average home buyer in England and Wales is £4,500 better off under the new progressive structure of stamp duty introduced a year ago but the Treasury is collecting a record amount of the tax. Since the change the typical home buyer has paid a total of £3,676 in stamp duty, based on the current average house price of £273,531. Under the previous flat structure, a buyer paying this price would have been subject to stamp duty payments of £8,205, a saving of £4,529. The research from the Halifax, a major UK lender, also shows that the ‘tipping point’ price is £938,000, when a buyer is worse off under the new stamp duty structure and sales above this level in the first six months of 2015 were 10% lower than in the first half of 2014. This decline was exactly in line with the market as a whole, with total sales also down by 10%. This is in contrast to both 2013 and 2014 when the prime end of the market was significantly outperforming the rest of the market. More significantly, sales above £1.5 million, which are more affected by the changes, have seen a bigger impact with a 20% decline, twice the market fall. The research also reveals that increased property prices and a higher number of residential property transactions boosted stamp duty revenues by 16% between 2013/2014 and 2014/2015 to a new record high of £7.5 billion. This comfortably exceeded the previous high of £6.68 billion at the peak of the last housing market boom in 2007/2008 and was more than 14 times as much as the £520 million raised by residential stamp duty 20 years ago in 1994/1995. London alone contributed 40% of all UK stamp duty revenues in 2014/2015 compared with 13% of all property transactions. London’s stamp duty share has risen from 28% in 2007/2008, with revenues raised in the capital increasing by 60% from £1.9 billion in 2007/2008 to £3 billion in 2014/2015. Some 80% of all home purchases in England and Wales between May 2015 and July 2015 were above the starting stamp duty threshold of £125,000 ranging from nearly all sales in London to 55-60% in northern England and Wales. This compares to 71% in 2006 when the starting threshold was initially raised to its current level. The starting threshold would now be £157,000, some £32,000 higher, if it were raised in line with house price inflation since 2006. Nationally, 32% of all purchases by first time buyers were below the £125,000 threshold at which stamp duty becomes payable during the three months from August 2015 to October 2015. ‘The changes made to stamp duty a year ago have been of significant benefit to many buyers. Only those purchasing the most expensive homes are worse off. There is some evidence that the top end of the market has been adversely affected by the changes with sales over £1.5 million falling by twice as much as the… Continue reading
Bucharest real estate markets have seen strong sales in 2015
A stable economic environment and growth potential has resulted in the commercial real estate market in Bucharest, Romani, gaining momentum with sales expected to be close to €800 million by the end of 2015. This year has continued the growth trend begun in 2014 and saw a real estate market dominated by more courageous players, according to the latest analysis report from real estate firm Colliers International. It forecast at the beginning of the year that the Romanian investment market would see sizable transactions value exceeding the €100 million threshold, and international investors either entering or consolidating their positions on the local market. The report says that outsourcing businesses are still the prominent pillars of the office sector, as Romania becomes more visible for reputable BPOs, SSCs and IT companies, with focus on Bucharest, but also secondary cities. More than 60,000 people are currently employed in outsourcing activities and forecasts provision up to 150,000 in the next five years. Characterized by vibrant activity, office sector in Bucharest is on the verge of a new era of premium quality deliveries in what is to become a half million square meter office hub by 2020 in the Floreasca Barbu Vacarescu area. ‘Aligned with our expectations from the beginning of the year, real estate market has been characterized by general positive evolution for transactional activity for all sectors. Relying on good macroeconomics indicators, the year brought more intense consumption and higher interest in investment,’ said Ilinca Paun, managing director of Colliers International. ‘With take-up picking up and vacancy rates reporting low record levels, developers felt confident enough to start projects across the entire market. Industrial sector will add new stock to the static inventory registered in the past years, while investment market continues to post remarkable results this year also, with total volume expected to reach Euro 800 million by the end of the year,’ added Paun. The report says that the Floreasca Barbu Vacarescu sub-market stands out as the new CBD area in Bucharest. The modern stock of buildings in the area was subject to the biggest part of the demand, with 215,000 square meters leased in the past five years. The area will continue to be in the spotlight in the years to come with 155,000 square meters of GLA of office space being planned for development. Nevertheless, the competition in the sub-market becomes fiercer with each new announced development, the report says. According to Andreea Paun, associate director of office agency at Colliers International, Romania not only has become an attractive destination for the outsourcing industry, but has also changed the way it’s being perceived by large companies. ‘Romania is no longer seen solely as a cost effective destination, but rather a value added generator and valuable talent pool. Similar to previous years, the business services industry has driven most of the office demand. We foresee this trend will grow stronger in the future as renowned outsourcing companies are… Continue reading
Number of new affordable homes built in UK up 55% year on year
The latest figures show 66,640 new affordable homes were delivered in the UK in the last year, 55% more than the previous year and the fastest rate of growth since 1993. Communities Secretary Greg Clark said this was further proof of the government’s commitment to get more homes built. He announced that the number of social and affordable rented homes has increased by nearly two thirds, and the number of affordable homes to buy rose by 41% over the same time period. ‘We are far from complacent and the doubling of government investment in house building announced at the recent Spending Review reaffirms our commitment to deliver a million new homes by 2020,’ said Clark. He pointed out that affordable homes to rent and buy are a key part of that, helping to give young people and families across the country the best possible start in life. Housing Minister Brandon Lewis said it showed that house building efforts are paying off. ‘This is real progress but there is more to do. That’s why we are going further and increasing our investment in these homes to ensure many more people can benefit,’ he added. The figures mean that over 270,000 new affordable homes have been delivered since 2010. At the Spending Review last week, the government announced plans to double investment in house building to £8 billion, to help towards delivering one million homes by 2020 and to deliver the largest affordable housebuilding programme since the 1970s. This includes 135,000 new homes to buy through a new Help to Buy: Shared Ownership scheme, a new London Help to Buy, to help aspiring home owners in the capital to buy with a fraction of the deposit they would normally require and 200,000 new Starter Homes, which will be available at a 20% discount to young first time buyers. This is on top of measures included in the Housing and Planning Bill currently going through Parliament, including ensuring new Starter Homes are included on all reasonably sized development sites. The Bill will also mean giving communities the power to grant permission in principle on sites identified in local plans and on brownfield registers, to speed up the planning system while at the same time protecting the green belt and planning reforms to support small builders, with a requirement for councils to offer shovel ready sites for custom build homes. Continue reading
