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It's about value, not size. You buy a house, the value massively increases and you pay next to no tax on your massive gain. We are just about to levy a tax on every single worker including those on minimum wage but housing is left alone for political reasons. It would also be far better to tax people who are holding property as opposed to penalising them when selling/moving with SDLT, which means old grannies have no choice but to stay put in 5 bed mansions until they die
(Obviously I am biased as a 30 yo professional who can't afford a mouldy 1 bed, let alone somewhere I'd actually want to raise a child or whatever)
(Would also start with second homes and landlords and leave homeowners alone for now though)
frankenbike-
It's often hard to downsize when you get older.
Apartments can be ££ bungalows are rare, it's a good point though that perhaps downsizing should incur less of a tax.
Otherwise the pensioner in a 5 bed is stuck with taxes & unable to downsize which I think is not what we are after.
My parents cannot downsize as apartments where they are cost more than their house will sell for.
My dad is looking into converting half of it into an apartment so they can make room in the house for others, it's not cheap or easy either.
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We are just about to levy a tax on every single worker including those on minimum wage but housing is left alone for political reasons.
It would be about as popular as the poll tax
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Obviously I am biased as a 30 yo professional who can't afford a mouldy 1 bed
I feel ya
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The possitive side effect of this is that it would also devalue properties and slow down the ridiculous market as many wont afford to buy their home for the same coins if they also have to factor in taxes on top.
That said their will be a lot of "loosers" that are not rich but just very much in debt.
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You buy a house, the value massively increases and you pay next to no tax on your massive gain.
I think the increase in the value of a house is a bit of a red herring. Averaged out across the whole country a 3-bed family home has the exact value of a 3-bed family home i.e., if you buy a house then the value you realise from selling it will allow you to buy only a house of exactly the same size (actually slightly less because of SDLT and various other costs associated with selling, buying and moving). You could sell it in order to get another property that you want more, for example by moving to an area where prices are proportionally lower and getting a bigger place, or moving to a more desirable area and getting a smaller place, but a house is always just worth (in and of itself) a house.
It seems quite odd to tax people just for ownership of something that is really just a functional object for your everyday life (it would be a bit like taxing shoes or a bed), not least because you're already taxed on the income you use to pay for it and quite often have to take on significant debt to own that asset.
The real value of a house is not the gain in its value, but the fact that the money you put into paying off your mortgage is still, in effect, yours (i.e., embedded in the value of the house you can then sell) rather than spaffed away in rent. There are other intangible benefits like peace of mind, but also some tangible losses (SDLT, maintenance etc.). I don't know what the solution is, but the huge disparity in the personal financial impact of owning vs. renting might be better addressed by reducing the latter.
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It's about value, not size
Haven't you just described how council tax works? Banding based loosely on property value.
Council tax should probably be 5-10x what it is tbh
JWestland
Howard
MCamb
badboybjorn
ffm
rhowe
This. Just a normal family home, same as my wider family. I just happen to live in London and they live in North Kent. Whats the reason I should pay more? Their houses are bigger than mine!