Wednesday, Nov 25, 2009

I hope Silvio isn't one of them...

Investor's Chronicle: Italians fuel superprime London market

80 percent of superprime purchases are Italian? Mio Dio...

Posted by chrisch @ 05:32 PM (1255 views)
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10 Comments

1. will said...

Ice cream anyone?

Wednesday, November 25, 2009 05:39PM Report Comment
 

2. drewster said...

If this Italian tax amnesty is a one-off, then it will only provide a temporary boost to the London property market.

I find it strange that they all choose London - do none of them want a house in Paris or Dublin instead? Is the London market more liquid? Are the total transaction costs lower here? Are they not put off by the 4% stamp duty payable on houses worth more than £500,000? Are there tax advantages for foreigners buying property in the UK compared with other countries?

Wednesday, November 25, 2009 06:14PM Report Comment
 

3. mark said...

Anyone ever thought we are being fed BS from a corrupt system??

Wednesday, November 25, 2009 06:36PM Report Comment
 

4. Another_pleb said...

What a mistake-a to make-a!

Wednesday, November 25, 2009 06:54PM Report Comment
 

5. mken said...

The amnesty is granted on money being repatriated to Italy. How does this translate to more money in London?

Wednesday, November 25, 2009 08:04PM Report Comment
 

6. Mariothegreat said...

I think (I'm Italian) my countrymen believe the 50% crash of the pound is a good occasion
to make a sound investment..
Not me..

Wednesday, November 25, 2009 09:17PM Report Comment
 

7. drewster said...

mken - that's confusing me too. I think I have an explanation.

The tax dodgers have squillions in cash lying around in bank vaults in Switzerland, doing nothing. It's earning next to 0% interest because of all the recent rate cuts - in fact its purchasing power is being eroded by money-printing. The amnesty means they can take the money out of their secret Swiss bank accounts and 'invest' it in property.

This still doesn't explain why they've chosen London, or why they've chosen to invest in property rather than other assets (shares).

Wednesday, November 25, 2009 10:18PM Report Comment
 

8. Jpdoyle said...

"2. Are they not put off by the 4% stamp duty payable on houses worth more than £500,000?"

In Italy, the tax when buying ANY house from an estate agent is 129.11 euro land registry tax, 258.22 euro registry fee and 4% VAT. If the house is not your primary residence the VAT is %10, and if it is classed as a 'luxury' property the VAT is 20%. On top of this tax, there is a notary fee which is usually thousands of euro extra which is also subject to VAT at 20%. Buying property in Italy is very heavily taxed.

It is slightly cheaper if you are buying from a private seller as there is no VAT charged on private sales, but the tax is still 3% + 258.22 euro, plus the notary fees.

Thursday, November 26, 2009 12:15AM Report Comment
 

9. drewster said...

Jpdoyle,

Thanks for the insider info. Sounds like the London market is more liquid indeed.

Thursday, November 26, 2009 10:33AM Report Comment
 

10. ontheotherhand said...

Drewster. There is no witholding tax in the UK on capital gains on property. It's up to the foreigner to declare the gain to their home country. This together with London being an international city with solid property laws makes it a favourite parking spot for the spare millions of the rich of the world.

Thursday, November 26, 2009 03:34PM Report Comment
 

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