The Emergency Budget Written by Andrew Ellinas Wednesday, 23 June 2010
The Emergency Budget

The Chancellor of the Exchequer has missed the opportunity to reform the property market in the emergency budget. The tinkering with capital gains tax, while not as damaging as we feared, will do little to help people buy the homes they need or invest in property to rent out.  Meanwhile, stamp duty land tax with its market-distorting artificial bands remains in place, and the opportunity to reintroduce taper relief on investments has been missed.

We expect the market in Marylebone, Regent's Park and St John's Wood to continue to recover slowly as investors take stock of market and monitor prices.

There may well be a bit of a hiccup in January when the rise in VAT to 20 per cent increases the cost of buying and selling property. In the interests of our clients, we will be taking active steps to mitigate the effects of this rise when it happens.

The main victims of the emergency budget, ironically, may well be students looking to live close to the universities in the area, who may well be squeezed out as investors move out of the private rented sector, deterred by the new CGT regime.

back to top