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Mansion tax warning for thousands of Richmond homes
Families could face mansion tax bills averaging nearly £2,000-a-month if the levy is brought in, according to new research.
Estate agents Knight Frank claim that rising property prices meant thousands of homeowners across the borough could be caught by the tax, on properties worth more than £2m, within a decade.
According to Knight Frank, Richmond would be among the 10 boroughs to be hit the hardest by the controversial tax, with already 1,839 homes worth £2m or more.
This is expected to rise to 3,181 by 2018 and to 5,503 by 2023.
The biggest concentration of £2m homes were in Kensington and Chelsea, where 11,955 match the price requirement.
Knight Frank said one in 10 of all £2m “mansions” were one or two bedroom flats.
It warned that relatively modest suburban family homes could be trapped by the annual tax on the country’s most expensive properties, which has been backed by Labour and the Liberal Democrats.
Liam Bailey head of research at Knight Frank, said: “In the past 10 years house prices have risen by 69 per cent.
“Assuming a similar rate of growth in the future, all houses worth more than £1.2m today would be paying a mansion tax 10 years from now, meaning the number of homes covered would nearly triple from 55,000 to 157,300.”
Knight Frank said if the threshold was not increased the number of properties caught in the mansion tax trap would spread across the capital to thousands of families in Haringey, Hounslow and Ealing.
The estate agent said the tax would be levied overwhelmingly on London, which already pays almost 40 per cent of all stamp duty raised.
Lib Dems and Labour claim mansion tax would raise billions of pounds a year but Knight Frank’s research suggests the threshold would have to be lowered to reach the desired targets.
Mr Bailey said: “Our calculations point to the real threat of the mansion tax threshold being lowered substantially in order to meet the revenue targets of the political parties.
“Even if the threshold is not lowered, it seems a fair assumption – given that it has remained at £2m since 2009 - that it would not be raised in line with future house price inflation, thereby substantially increasing the number of properties affected by the tax.”
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