UK property investors from China breathed a sigh of relief at this year’s budget. Pantazis Therianos, CEO of Euroterra Capital experienced first-hand the reaction of Chinese property buyers; “Even in light of the time difference between China and the UK, those who had pressed pause on their investment decisions in the week before the budget announcement, were very quick to formalise their offers late this afternoon. We received five offers for properties in W2, with four confirmed almost immediately. The first was a Notting Hill apartment at £2,520 psf and the second a Bayswater apartment at £2,435 psf.”
The year ahead looks positive as the budget seems to support small to medium house builders in their quest to deliver more new homes into the market; Chancellor Phillip Hammond promised £1billion of British bank guarantees meaning developers have greater access to low cost development funding.
In the immediate aftermath of the announcement the sterling fell against all major currencies. Although GDP growth is expected to be even more positive than was expected, Brexit uncertainty likely to remain the most dominant factor on the strength of the sterling. For RMB holders, this means ongoing currency discounts in the property market.
Much to the relief of long-term investors, Inheritance tax was not mentioned at all and Capital Gains Tax is subject to minimal changes. Today’s Budget announcement means that the UK remains a favoured safe haven for foreign property investors.
It’s great news for first time buyers too as stamp duty relief has been extended from £300,000 to £500,000.
From April 2020 there will be some changes for landlords to prepare for as the lettings relief period has been shortened from 18 months to 9 months and will only apply to properties where the owner shares the property with their tenant(s). The impact is minimal and has already been offset by global currency plays.
For Euroterra Capital, “our strategic focus on the delivery of more new developments in the only Central London district to deliver price growth in the last year, has been buoyed by today’s Budget announcement” said an upbeat Therianos.
- The government will abolish Stamp Duty for all first-time buyers of shared ownership properties valued up to £500,000
- Mr. Hammond also announced that up to £1billion of British Business Bank guarantees to support smaller housebuilders to deliver more new homes
- The government will also seek to facilitate the redevelopment of underused retail and commercial areas into residential