Liquid error: wrong number of arguments (2 for 1) Financial Reporter: Non-dom and Stamp Duty changes fuel domestic sales | Marsh & Parsons Sales and Lettings Estate Agents London

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Financial Reporter: Non-dom and Stamp Duty changes fuel domestic sales

Thu 19 Nov 2015

Sales activity from domestic buyers has surged forwards to fill the gap left by overseas buyers and investors, whohave been left more cautious by the strong sterling, stricter Government measures on non-domicile status, andheftier Stamp Duty for higher value purchases.

According to Marsh & Parsons latest London Property Monitor, 79% of property purchases were made bydomestic UK buyers in Q3, up from 75% a year ago.

Domestic mortgage buyers and first-time buyers have become more prominent in the London market, with theproportion of mortgage buyers in Prime London soaring from 53% in Q2 to 65% in Q3.

At the same time, overseas and foreign nationality buyers accounted for just over a fifth (21%) of all PrimeLondon property purchases during Q3 2015, which has fallen quarter-on-quarter, and is also down from 25% of allsales during the third quarter of 2014.

This pattern is also being mirrored in Prime Central London, traditionally favoured by overseas investors, with theproportion of foreign buyers standing at 32%, down from 34% in Q2 and 37% a year ago. The investor share ofthe market has also dipped in Prime Central London over the past three months. Investors accounted for 35% ofall Prime Central London sales during Q3, a considerable drop from 42% in Q2.

Yet with domestic buyers stemming this shortfall, overall demand for Prime London homes has grown in the threemonths to September 2015, and the number of registered buyers has climbed 4%.

Peter Rollings, CEO of Marsh & Parsons, commented:

The London property market has had to grit its teeth and bear the brunt of some rather trying taxation changes inrecent months. At the high-end buyers are at the rock face of the new steeper stamp duty, and from overseas thestrength of sterling, and government encroachments on nom-dom status make investing in the London propertymarket seem daunting. This has cast some shadows over the capital, but the millions of Londoners who live and
work in the city have acclimatised much more quickly to the property taxation changes, and have risen up to fillthe void left by overseas purchasers and investors. Were noticing longer purchase chains than ever as domesticbuyers really start to dominate the market, and demand is really putting a strain on supply. This should ensurethat London houses prices and sales activity continue their ascent into 2016.

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