Despite the EU Referendum, this year’s General Election, higher rates of taxation than the rest of the UK and a chronic lack of supply, Scotland is experiencing the strongest property market since 2008.
Should the Scottish Government reconsider LBTT rates then the property market has the potential to rival the performance of other markets around the UK and attract greater inward investment, according to Savills latest research.
It was reported that market activity across Scotland is at its highest level since 2008, with a total of 101,421 residential transactions during the year ending June 2017.
However, the market above £750,000 is struggling to adjust to Land and Buildings Transaction Tax (LBTT) and witnessed a reduction in transactions.
Andrew Perratt, Head of Savills Residential in Scotland said: “Punishing rates of property taxation is putting Scottish property buyers at a distinct disadvantage. “Buyers in Scotland are paying £48,350 on a £750K residential property for a main home or £70,850 for a second home.
“In the rest of the UK, the tax would only be £27,500 for a main home or £50,000 for a second home.
“As a result, the average prime transaction price in Scotland has fallen from £572K to £554K in five years.
“The political landscape is dictating the market in some price bands, with higher rates of property tax in Scotland discouraging movement amongst local buyers and doing little to attract inward investment from further afield.”
Source: s1homes Fife magazine