Question: What is the impact for the top end of the property market
Answer: We are experiencing a marked slowdown at the top end. It will result in many buyers offering much less for properties at the higher end.
LBTT will really hurt homeowners at the higher end as banks will be unlikely to finance the huge increase in duty.
Buyers will have to find the extra money from their personal savings which have already been subject to the highest rate of tax.
My views are based on hard facts and evidence we are already seeing in the market.
And if higher income tax rates for high rate taxpayers are imposed in Scotland that will have a further devastating effect on higher valued properties.
Uncertainty over changes in the tax regime makes buyers becoming nervous and stand back from taking decisions to buy. That could mean a serious slow down at this end of the market.
Question: What is the impact for First Time Buyers & The Middle Market?
Answer: First time buyers – targeting low value properties in the price range below £100,000 – will probably do well.
The SNP made a firm and binding commitment in their manifesto to help more first time buyers get on the housing ladder.
In that case, we will probably see the return of 95-100 per cent mortgages becoming more widely available or more resources going into help-to-buy schemes. The only issue with help to buy is the scheme has been mainly targeted at new build properties and developers don’t build many first time buyer properties.
That will result in attention concentrating on financial support for second hand properties which may well have a positive impact on properties up to £250,000.