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LondonBound

Conservatives plan to restrict foreign buyers

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NOW they think of it, when it's been obvious for so many for so long that foreign buyers were contributing to ever rising prices, and builders ignoring what locals wanted or needed.  Why  would they give a toss when they could flog so much off-plan in Hong Kong, Singapore, Malaysia?  

 

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3 hours ago, LondonBound said:

http://www.telegraph.co.uk/news/2017/09/23/plans-tougher-restrictions-foreign-buyers-help-first-time-buyers/

Given its in the Torygraph, I'm pretty hopefully this could quickly become policy. 

 

The barriers to foreign buyers were already put in place a few years ago with things like the SDLT surcharge which means those buying properties through a company have to pay 15%, ATED, CGT, IHT changes and changes to non-dom laws. Ironically these all happened under the Tories. 

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8 minutes ago, Mrs Bear said:

NOW they think of it, when it's been obvious for so many for so long that foreign buyers were contributing to ever rising prices, and builders ignoring what locals wanted or needed.  Why  would they give a toss when they could flog so much off-plan in Hong Kong, Singapore, Malaysia?  

 

It's a clever move and exactly what they should do.  They won't do it.

It would help their demographic problems, might even win back London for them.  It upsets only a fraction of their backers, and they can spin it as nationalism and putting Britain first, which will appeal a lot to their base.

They won't do anything meaningful. At best they'll make a token move towards it, they won't actually ban sales to foreigners or even enforce current money laundering legislation.

I think, and I hope I am wrong, that they do not actually in derstand the problem.  It's not an image problem.

No amount of pretending, or promising, with help to buys and minor tax amendments is going to change the fact that renters don't vote for the Conservative party.

They have to actually transform tenants into homeowners.  The only way to do that is to reduce the landlord infestation of our housing stock.  

A house owned by a landlord means one less homeowner, and one less potential Tory vote.

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4 minutes ago, fru-gal said:

The barriers to foreign buyers were already put in place a few years ago with things like the SDLT surcharge which means those buying properties through a company have to pay 15%, ATED, CGT, IHT changes and changes to non-dom laws. Ironically these all happened under the Tories. 

With little effect.   There's no justification whatsoever for allowing UK housing stock to be sold to foreign absentee owners. 

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11 minutes ago, DrBuyToLeech said:

With little effect.   There's no justification whatsoever for allowing UK housing stock to be sold to foreign absentee owners. 

True. Not sure what they can do except ban foreign buyers completely. They will probably do something really crap like say properties need to be advertised in the UK for 3 months before they can be sold to foreign buyers. That will be their big, radical change. 

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Unable to read the whole article because of paywall. My gut reaction is the may restrict Chinese buyers somehow but to support the Chinese government's desire to prevent capital outflows. Certainly their core intention has nothing to do with first time buyers. 

Whatever the motivation I would love to see this kind of policy come into play. 

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If the west eventually goes to war with China, won't the British government be able to freeze Chinese assets ie all the new flats built recently, nationalise them and call them "social housing".

Seriously though, this all seems to smack of too little too late. The horse bolted a long time ago. A few cosmetic changes will make little or no difference. 

The problem is rooted in lending policies ie buy to let, self certification, lack of building, financial institutions needing to inflate their balance sheets  and demographics. Window dressing by using foreign scapegoats isn't going to change anything.

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1 hour ago, fru-gal said:

True. Not sure what they can do except ban foreign buyers completely. They will probably do something really crap like say properties need to be advertised in the UK for 3 months before they can be sold to foreign buyers. That will be their big, radical change. 

That was exactly my guess.  If so, it won't make any difference and won't help their problems one bit. 

Osborne's policy was pretty good, they should extend that.

Also, they should start enforcing the existing money laundering rules. 

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5 minutes ago, Pindar said:

If the west eventually goes to war with China, won't the British government be able to freeze Chinese assets ie all the new flats built recently, nationalise them and call them "social housing".

Seriously though, this all seems to smack of too little too late. The horse bolted a long time ago. A few cosmetic changes will make little or no difference. 

The problem is rooted in lending policies ie buy to let, self certification, lack of building, financial institutions needing to inflate their balance sheets  and demographics. Window dressing by using foreign scapegoats isn't going to change anything.

It will restrain land prices in cities for one thing. 

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1 hour ago, DrBuyToLeech said:

They have to actually transform tenants into homeowners.  The only way to do that is to reduce the landlord infestation of our housing stock.  

A house owned by a landlord means one less homeowner, and one less potential Tory vote.

Several fewer Tory voters, in fact. Since wage growth is non-existent HPI can now only proceed via the subdivision of the housing stock into ever-smaller units and HMOs.

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44 minutes ago, Pindar said:

If the west eventually goes to war with China, won't the British government be able to freeze Chinese assets ie all the new flats built recently, nationalise them and call them "social housing".

At least land will be cheap if that happens, if there's anyone left around and who wants to buy a radioactive hole in the ground.

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1 hour ago, Sawitcoming said:

Unable to read the whole article because of paywall. My gut reaction is the may restrict Chinese buyers somehow but to support the Chinese government's desire to prevent capital outflows. Certainly their core intention has nothing to do with first time buyers. 

Whatever the motivation I would love to see this kind of policy come into play. 

They just need to make ownership reciprocal.

China has a logical foreign ownership policy....you work in China = you can have a house for your own use.  You dont work in China = no thanks

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9 minutes ago, Fromage Frais said:

China has a logical foreign ownership policy....you work in China = you can have a house for your own use.  You dont work in China = no thanks

That seems sensible. 

1 hour ago, Pindar said:

If the west eventually goes to war with China, won't the British government be able to freeze Chinese assets ie all the new flats built recently, nationalise them and call them "social housing".

Seriously though, this all seems to smack of too little too late. The horse bolted a long time ago. A few cosmetic changes will make little or no difference. 

I doubt we will be going to war with China any time soon or am I missing something?

Too little too late definitely.

 

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13 minutes ago, Sawitcoming said:

I doubt we will be going to war with China any time soon or am I missing something?

Trump attacks North Korea, North Korea gets backed up by China, and we just do whatever the USA wants (or it triggers a worldwide disaster that we won't escape from whether we take part or not)>

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FWIW i think this is potentially significant. I think the Tories do understand the significance of what is happening re house prices, and the younger generation being squeezed out, the rising share of voters who rent vs buy, and what that means for their base longer term. Given the housing crisis they know the politics of allowing empty flats to be hoarded by foreigners is terrible for them as well. Restrictions on foreign ownership make perfect sense. And house price changes happen at the margins - at the peak I remember reading (though cant remember the source) that London had nearly 30% of all global cross boarder residential capital flows. I think the next biggest individual city was New York at less than 10%. This is why we got the bubble mania prices a couple of years ago. If you reduce that it will have a significant impact on the speed with which the London bubble deflates, which will have an impact across the country. This is potentially big news for HPC in my view. 

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30 minutes ago, Maynardgravy said:

What would you do if you knew foreign buyers were already drying up? Maybe hatch a policy to pretend it was you all along helping hard working families?

Sounds plausible. Also you wonder if they will do the same thing as with the additional stamp duty deadline and give people a few months' warning to juice transactions for a bit. 

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7 hours ago, LondonBound said:

http://www.telegraph.co.uk/news/2017/09/23/plans-tougher-restrictions-foreign-buyers-help-first-time-buyers/

Given its in the Torygraph, I'm pretty hopefully this could quickly become policy. 

 

Restrict?

 

end...CPO the others then auction them off.

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1 hour ago, Riedquat said:

 

1 hour ago, Maynardgravy said:

What would you do if you knew foreign buyers were already drying up? Maybe hatch a policy to pretend it was you all along helping hard working families?

This.

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New york has property taxes of 1.5 percent on the value of property paid by ALL residents, foreign nationals or not. Someone with a 3 million valued property would pay 45 grand a year, compared with less than two in london.

Foreign buyers is a symptom of under taxing of property wealth plus governments that will prop up property prices whatever. It is a lot easier to use this as a distraction rather than address the real causes that vested interests benefit from.

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Canada has done some interesting things also. Many of the properties I see listed for sale there you have to live locally in order to buy. They also tax empty foreign owned homes in Vancouver because it was becoming a delapidated ghost town.

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3 hours ago, Electricity said:

I doubt foreign buyers are buying first time buyer type properties.

Yes but first time buyer properties have been demolished to build modernised property marketed to the rest of the world, built to order.;)

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4 hours ago, fru-gal said:

True. Not sure what they can do except ban foreign buyers completely. They will probably do something really crap like say properties need to be advertised in the UK for 3 months before they can be sold to foreign buyers. That will be their big, radical change. 

Haha, so true, but I think this could be a goer. As mentioned, the big problem is the undertaking of property, but they won't tackle that because of the "asset rich, cash poor" granny who, "through no fault of her own", is sitting on a £3m Notting Hill terrace. Of course, that's exactly who the government should hit to incentivise downsizing, but ain't happening. A decent tax on foreign owners would bump government coffers and annoy very few voters (yes, would lower prices, but majority seem to want that now)

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  • 295 Brexit, House prices and Summer 2020

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