Analysis by Knight Frank has revealed that 2.5% of homes in London would be affected by a planned ‘mansion tax’ on properties worth more than £2 million.
To measure how this impact on the capital equates to the rest of the country, Knight Frank examined ten other markets to determine the top 2.5% by value and the equivalent ‘mansion tax’ entry point in each.
The top 2.5% of the West Midlands property market, for example, represents homes worth more than £472,216.
“The data puts the London housing market and the disproportionate impact of a mansion tax into a national context,” Tom Bill, Head of London Residential Research at Knight Frank, said. “House prices have grown more in London than other regions in recent years but this reflects high demand and constrained supply more than wage growth or any greater capacity of London homeowners to pay tax.”
He added: “Furthermore, the data underlines the mismatch between the term ‘mansion’ and reality of property markets across the UK.”
38% of all £2 million-plus properties in Greater London were flats while only 14% were detached properties, Knight Frank’s analysis found. The second largest group (at 36%) were terraced houses, while semi-detached properties made up the remaining 12%.
In the 2013/14 tax year London contributed 42% of all stamp duty revenue in England and Wales, up from 41% the previous year.
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