to think the idea of a mansion tax just penalises London and the south

[Redpipe]

I will probably get flamed for saying this but I don't believe that owning a 2 million pound house automatically makes you rich. Certainly in London a 2 million will not buy you a mansion, more like a terraced family home.

AIBU to think that the idea just penalises people in the south?

[Theincidental]

When people on benefits in central London had their housing benefit capped because the government didn't want to find the going rate for accommodation, many people said they should just leave London and get something they could afford!

That seems to me the more appropriate response to people in London with £2 million pound houses.

If they can't afford the mansion tax, with a property of that value, then go find somewhere they can afford.

Unlike people on benefits, they would have the luxury to afford moving costs and have sufficient funds from a sale to build a new life out of the city.

[HalooJones]

Owning a 2 million pound house in the UK makes you rich, end of.

[itsametaphordaddy]

A two million quid house doesn't make you rich? Are you friggin kidding?

[BlameItOnTheBogey]

I agree that it does make you rich. But it doesn't mean that you must have tons of disposable income. We own a three bed semi in London that would likely cost less than a quarter of the price in the north. We are lucky we can afford it, but a mansion it ain't. We can't move to the north though because our jobs only exist in London.

[Redpipe]

HalooJones but there are pensioners in 3 bed terrace houses which they bought years ago. They could find that the house soon goes over the threshold but their income could be quite meagre.

Theincidental The difference is though that people who own a 2 million house are not being supported by others taxes. However, they would be made to move because they are being asked to support others.

My OP is really more about someone who actually does live in a mansion in the north east and who might have a huge disposable income may not be taxed but a lower earner who has owned their house for decades in London may be priced out of their own home.

[InMySpareTime]

Even if your jobs are in very affluent areas of London, the transport links throughout London are such that if this was really a concern you could find a house (probably a choice of several thousand houses in fact) that costs considerably less than £2M. You could then commute, as hundreds of thousands of people do each day.
The Mansion tax is totally avoidable if you "can't afford" it. You only pay it if you want a nice house in a nice area in the SE or London, or if you want a mansion in a smart area anywhere else in the UK.

[stubbornstains]

Out of interest, could you link to some three bedroom terraced houses in London that cost 2 million? Am intrigued....

[HalooJones]

Why do some people think that moving out of London is beyond the pale?

[Redpipe]

My neighbour bought his house 50 years ago, the area was working class then, as is he. His house is now worth well over 1 million (3 bed terrace) but there is no way on earth his pension would come close to paying for Mansion tax if prices keep going up. He drives a banged up 15 year old car and has to think about how much he can spend in the supermarket. Why should he have to move?
This scenario would not happen further north. I think this penalises Londoners and the south.

[itsametaphordaddy]

But the person in the north wouldn't necessarily have a huge disposable income either. People in the north tend to earn less. In a lot of cases they earn a lot less.

[LittleWhiteWolf]

If you own a £2 mil house and aren't rich then you must be pretty bad with money IMO.

[InMySpareTime]

Redpipe, if your elderly friend's £1M house goes up to over £2M, surely so will the threshold for mansion tax?

[Binkybix]

I think I agree that it's unfairly penalising those in London, although I do find it difficult to have sympathy for those buying a £2million house - you can get something pretty nice in London for that, although maybe not in location of choice. I think stamp duty is actually far worse for this, and affects many more people.

Have to say,though, if you can afford to buy a £2million house, you are exceedingly rich!

[Redpipe]

stubborn stains certain a 3 bedroom terrace not done up can fetch over a million in many areas of london. I'll try and get some links on here in a minute.

Haloojones Why should a retired person in their 80's born and bred in London move out because they have been taxed out. They are not asking for hand outs they have paid for their house and will pay huge death taxes on the property when they die. Why should they be taxed out of their own home?

[Redpipe]

Inmyspare

It's already well over a million and the rate at which prices are rising in London it probably won't be long. There is no talk of upping the threshold.

[InMySpareTime]

Also, if Redpipe's neighbour moved, he could free up substantial equity from his home. He could buy a smaller property, or move to a nearby area that has become less gentrified and live the life of Riley instead of hanging onto a valuable asset that's a millstone round his neck.

[RedJeans]

Here's one stubborn
www.rightmove.co.uk/property-for-sale/property-40155175.html

[HalooJones]

An 80 year old pensioner in 2 million pound house in London will have benefitted enormously from house price inflation.

[WMittens]

and will pay huge death taxes on the property when they die

Can you explain to me how a deceased person pays tax?

[RedJeans]

Oops, tunrs out thats four beds! close though

[RedJeans]

another one www.rightmove.co.uk/property-for-sale/property-37953068.html

[Redpipe]

itsametaphordaddy

Someone earning an average income in the north is highly unlikely to be living in a property at or near the 2 million threshold just because they have lived there a long time and the prices have gone through the roof. In the south this can be the case.

[HalooJones]

Are there any 3 bedroom houses in Belgravia? They'd be worth considerably more than 2 million I should think.

[Redpipe]

Wmittens

Part of the property the deceased person owned will go straight to the inland revenue.

[HalooJones]

An OAP wouldn't have to move out anyway, they could just sign some kind of contingency agreement to give someone a % of their house when they die.