London’s super-prime landlords appear to be benefitting from higher stamp duty costs and Brexit uncertainty, as reflected by a rise in super-prime letting transactions, according to a fresh report from Knight Frank.
Sellers in prime central London are struggling to attract purchasers against a backdrop of higher property taxes and weaker sentiment owed in part to the outcome of the EU vote, as more families opt to rent rather than buy property in order to avoid steep stamp duty tax bills.
Recent tax hikes on expensive homes, mean that the stamp duty on the purchase of a £15m property is now £1.714m.
Super-prime letting transactions in central London increased 16% to 109 in the year to September compared to the previous 12 months, Knight Frank said.
Almost a quarter of high-end property transactions took place in Knightsbridge, but other desirable areas like South Kensington, Mayfair, Regent’s Park and Holland Park also attracted super-prime renters.
“Given the higher running costs buyers also face, stamp duty can be a concern unless they plan to be in a property for the long-term”, said Tom Smith, head of super-prime lettings at Knight Frank.
“This is particularly the case while uncertainty surrounds the short-term prospects for price growth”, he added, reflecting the fact that property purchase prices in prime central London are currently falling.