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Quicken

Residential Property For Residents

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Hello all,

This is my first thread on the forum and apologies if the topic has been covered before, but I couldn't find it with a search. I have been toying with an idea for eliminating the foreign property speculation that is particularly rife in London, and I would appreciate some feedback. My suggestion is to restrict the ownership of UK residential property to those who are both resident and ordinarily resident in the UK. I see multiple benefits to this including decreased price speculation and increased property availability. The government might also see the appeal as it would eliminate one method for avoiding CGT.

What do you think? Any downsides?

Q

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Welcome Quicken,

That would be nice but would probably be unenforceable unless you are just doing a 'resident in Britain for tax purposes' check. A lot of ex pats kept their houses on to rent out and provide themselves with a good income while they retired abroad.

The tories would also scream about damaging foreign investment so it probably wouldn't happen.

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Hello all,

This is my first thread on the forum and apologies if the topic has been covered before, but I couldn't find it with a search. I have been toying with an idea for eliminating the foreign property speculation that is particularly rife in London, and I would appreciate some feedback. My suggestion is to restrict the ownership of UK residential property to those who are both resident and ordinarily resident in the UK. I see multiple benefits to this including decreased price speculation and increased property availability. The government might also see the appeal as it would eliminate one method for avoiding CGT.

What do you think? Any downsides?

Q

Much more practical suggestion would be to level capital gains tax on UK non residents if they make a gain on any UK property (like Australia) and clam down on stamp duty avoidance scams but having houses owned by overseas companies.

Your suggestion wouldn't work as you can become R for one year then buy and then change your status.

Even if you come up with a good idea what are you going to do with it?????

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Welcome Quicken,

That would be nice but would probably be unenforceable unless you are just doing a 'resident in Britain for tax purposes' check. A lot of ex pats kept their houses on to rent out and provide themselves with a good income while they retired abroad.

The tories would also scream about damaging foreign investment so it probably wouldn't happen.

Hi and thanks,

I am specifically talking about both resident and ordinarily resident as defined for example here:

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/LeavingOrComingIntoTheUK/DG_078447

Since the government keep track of these for tax purposes, I think it should be enforcible.

Yes, under my proposal, all those ex pats would have to sell, and yes some tories would scream.

Cheers,

Q

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Much more practical suggestion would be to level capital gains tax on UK non residents if they make a gain on any UK property (like Australia) and clam down on stamp duty avoidance scams but having houses owned by overseas companies.

Your suggestion wouldn't work as you can become R for one year then buy and then change your status.

Even if you come up with a good idea what are you going to do with it?????

Hi grizzly bear,

Your suggestion sounds sensible, but I am not convinced mine is unworkable. Residence may change annually, but ordinary residence is calculated over several years (see the link in my previous reply). Furthermore, I am not talking about buying property, but owning it, i.e. if residency status changes, then the property must be sold.

I'm in contact with my MP (con), so I could pitch it to him.

Cheers,

Q

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Hello all,

This is my first thread on the forum and apologies if the topic has been covered before, but I couldn't find it with a search. I have been toying with an idea for eliminating the foreign property speculation that is particularly rife in London, and I would appreciate some feedback. My suggestion is to restrict the ownership of UK residential property to those who are both resident and ordinarily resident in the UK. I see multiple benefits to this including decreased price speculation and increased property availability. The government might also see the appeal as it would eliminate one method for avoiding CGT.

What do you think? Any downsides?

Q

It would make it difficult for people to move here from other countries. You become resident when you move here, which would be after you buy the house and move into it. You become ordinarily resident after a few years when you make this your normal place of residence. You can rent of course, and a lot of people do. But a rich person who wanted to bring their money into the country and start a business here would find it difficult to rent the sort of place he wants to live in, but could buy something relatively easily.

Also, you would have to restrict it to only people from outside the EU otherwise it would be struck out by the EU courts.

One loophole would be to buy the property through a company and live in it. There's no tax implication provided you don't put any property related expenses through the company except that you could save stamp duty by selling the company shares rather than the property. A lot of people already do that at the expensive end of the market, so the sales don't appear on the Land Registry.

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Presumably this would set a trend.

So no 2nd home in Florida, no retiring to a villa in spain.

TBH, I don't think foreign buyers have much effect except at the upper end of the London and SE markets.

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Didn't somewhere in Australia try this ? (Maybe Queensland?)

Buying property in new developments was restricting to a % of Australian residents. I can't remember if it was then further restricted to people who would actually live in the flats/houses.

My suspicion is that the governments and the London councils would not like it. It would certainly be helpful to non-home owning Londoners. The majority of flats in the development I rent in are owned by people abroad. Most of these are empty apart from peaktime likes the summer and sometimes Christmas. They only tend to be rented out briefly as "holiday lets".

The people who do own (and live in ) property here might not like it as well, if the prcies went down suddenly due to the forced sellout.

Edited by Flopsy

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  • 145 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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