Simple way to stop runaway house prices

[DimPrawn]

At the moment, your primary residence (and all other properties if you are an MP) is not subject to CGT.

Change the rule, so that CGT is charged after indexation against inflation is taken off.

So if for example, you buy at £500K and after a few years you sell at £1M, and £500K after adding inflation is then worth £700K, you owe CGT on the £300K difference.

This would tend to stop all housing rising above inflation as everyone would be shelling out CGT and so the price rises would tend to follow inflation.


Simples.

[AtW]

1. On demand side of things: min 25% deposit, max of 3 salary multiples loaned with no other debts.

2. On supply side of things: put BoE rates to reflect the economy: 5-7%.

3. On tax side of things: CGT (at old 40% rate) on gains that do not go into new house (ie when moving).

Like that's going to happen.

[HairyArsedBloke]

Increase supply (relax planning laws, stop NIMBY objections ) and/or reduce demand (cut and reverse immigration).

Even more simples.

[Moscow Mule]

At the moment, your primary residence (and all other properties if you are an MP) is not subject to CGT.

Change the rule, so that CGT is charged after indexation against inflation is taken off.

IIRC correctly, Luxembourg does this. The difference being that you can defer the CGT if you are buying a new house.

[Moscow Mule]

Increase supply (relax planning laws, stop NIMBY objections )

Not quite that simple in the SE - you'd have to increase infrastructure considerably.

Probably to the extent of building another Milton Keynes - and nobody wants that...

[HairyArsedBloke]

2. On supply side of things: put BoE rates to reflect the economy: 5-7%.

HOW THE FRACK is financing costs a supply side measure!

[Mich the Tester]

Not quite that simple in the SE - you'd have to increase infrastructure considerably.

Probably to the extent of building another Milton Keynes - and nobody wants that...

Seeing as all the roofs in Milton Keynes are flat, it would be easy and convenient to build a second Milton Keynes on top of the first.

[scooterscot]

At the moment, your primary residence (and all other properties if you are an MP) is not subject to CGT.

Change the rule, so that CGT is charged after indexation against inflation is taken off.

So if for example, you buy at £500K and after a few years you sell at £1M, and £500K after adding inflation is then worth £700K, you owe CGT on the £300K difference.

This would tend to stop all housing rising above inflation as everyone would be shelling out CGT and so the price rises would tend to follow inflation.


Simples.

I divide the house up into shoe boxes and sell the new apartments Londoners for an extraordinary price first before paying that tax...

[Moscow Mule]

Seeing as all the roofs in Milton Keynes are flat, it would be easy and convenient to build a second Milton Keynes on top of the first.

That is a fantastic idea.

MTT for MK Mayor!

[AtW]

HOW THE FRACK is financing costs a supply side measure!

Low interest rates now is the primary reason for low supply: people who got overextended and should have lost their houses instead sit on it hoping it will blow over. As the result less supply on the market because people with negative equity won't sell. Got it now?