The survey cited doesn't mention the Mansion tax, so the Times points to a 'general feeling'
A spectre is haunting London – the spectre of Labour’s Mansion tax. Fears over the proposed charge on £2million homes are driving down house prices in London, despite a rise in prices in the rest of the country. The Times has the scoop: ‘Mansion tax fears depress house prices across London’.
If we leave aside for a moment whether house prices in London couldn’t do with a bit of depression, what evidence is there that ‘Mansion tax-dread’ is the cause of this drop in prices?
Well, there isn’t any – at least, not in the Times story, which cites a survey by the Royal Institution of Chartered Surveyors (RICS) for February, released today, which found a rise in house prices nationally, and a price decrease in London.
Trouble is, the survey doesn’t mention the Mansion tax, either in its sample of responses or in it’s analysis. Neither does the RISC’s press release on its website. In fact, the only link made between lower prices in London and the Labour policy is in the Times piece itself:
“London homeowners are wary about moving because of extra fees and taxes they might face from a new government in May. Labour has already promised a tax on properties worth more than £2million, and there is a general feeling that politicians will step up their efforts to tap into property wealth for money to fund public spending.”
Ah yes, a “general feeling”. No evidence is provided for this assertion, or for “wariness” among homeowners.
Of the scores of RICS members quoted in the survey, which are only a sample of the 324 responses collected, just two mention the Mansion tax, and only one of these is based in London.
And with house prices rising nationally, and Labour’s policy intended for the whole country, why is this fear of the Mansion tax only gripping London?
Besides all of that, a 28 per cent drop in the ludicrously high price of a home in London will be music to the ears of many potential buyers. A report from the charity Shelter recently found the average house price in London is now almost 15 times the average wage.
Plus the Mansion tax will only affect homes worth over £2million – less than 0.5 per cent of all homes in the country – and only when the owners earn more than £42,000 a year.
So if the Times is going to claim fears about Labour’s Mansion tax are driving down house prices in London, their evidence ought to be more than a “feeling”.
Adam Barnett is a staff writer at Left Foot Forward. Follow him on Twitter
64 Responses to “Media Watch: Times blames Mansion tax fears for London house price drop. But where’s the evidence?”
Leon Wolfeson
…And there you have a key mutualist argument.
Lorne Gifford
This discussion has moved on a little from the original, ‘there is no proof mansion tax will devalue homes’. As Leon points out the top 1% own 50% of the worlds wealth and therefore should be made to pay more to ensure a more equal society.
The thing is though, this is a global issue and not a regional one. And on a global scale it is completely true that the top 1% do own 50% of the wealth. On a global scale the top 1% includes every single person in this country that earns the average wage or higher, and every single person that has an average price home or higher.
So, on a global scale, half the people in this country are part of the problem.
The ATED tax rates give a very good indication of the solution to this problem. Introduce a new tax at only the super-rich, ie property valued at more than £2m, but the following year reduce the starting value by half, and then reduce it by half again the year afterwards. This is how Ed Balls makes his estimated income from ‘mansion’ tax work.
So in essence a vote for mansion tax is actually a vote for property tax at 1% of value (payable every year) on any home that is average or better.
Rather than one liner insults in response to this comment, please google ATED tax rates and take a look at what is in store for all of us – well the half of us that count as super-rich that is
Guest
Apply those rates in a nonsense way. To generate nonsense. As you create spectres.
You’re trying to avoid paying a little tax.
Guest
“half the people in this country are part of the problem”
Ah, minimising the issue of poverty here. As you talk about something completely different. And demand it’s how things work, magically.
You are raising a spectre, 0.5%er, against paying tax on high-value homes. 0.5% | 50%. Get over it.
Lorne Gifford
Not really Leon. I work in Angola and the Congo a lot so perhaps it’s you who has an ‘out of sight, out of mind’ attitude to what poverty really means