Overseas buyers caught between rock and a hard place ahead of election day

Overseas buyers caught between rock and a hard place ahead of election day


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Overseas buyers may be faced with a relative drop in value of up to 30% in the event of a Conservative majority but would still meet the same fate should Labour come to power.

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That is according to a report by prime property consultancy Sterling Private Office, which found that foreign buyers may see a double hit to buying power as the pound and house prices are both set to rise in the event of a Tory majority.

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This misery will be compounded by recent news that the Conservatives intend to charge UK non-tax residents an additional 3% surcharge in stamp duty.

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The news will especially impact overseas investors – who were behind 58% of purchases in Belgravia, Mayfair, Knightsbridge and Chelsea in 2018, but just 44% in 2019.

However, the report suggests it’s still preferable to the environment they’d find themselves in should Labour come to power.

Nick Mead, director of Sterling Private Office, comments: “Life under Corbyn looks to be an extremely hostile one for overseas buyers – with the abolition of non-dom status, principal private residence relief, and non-favourable reforms to stamp duty and capital gains all sure to hit wallets hard.”

The report also contains some general advice for buyers and sellers on how they can handle their own sales and acquisitions in the current climate:

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Buying (only)

For those who are looking to buy, the price of a property will reflect no-deal uncertainty and the ‘threat of Corbyn’. If the polls are right, and that doesn’t materialise, it’s ideal to get the price locked in.

Selling (only)

It’s a good idea for sellers to stall until after the election. If the polls are correct, house prices will bounce, and sellers will want to re-assess their valuation.

Trading (both)

For those who are trading down, then it’s best to stall. While it’s possible to wear a hit on one transaction, it will be more than offset by the gain made on the other.

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