More demand for flats to rent in London under Labour?

flats to rent in London could become more popular, as Labour leadership hopeful David Miliband has revealed that he wants to implement a 'mansion tax'.

He told the Evening Standard that the annual charge would apply to anyone who owns a home worth more than £2 million, which includes around 34,000 properties in the capital.

Houses worth £3 million would have to pay an extra £10,000 a year, while £4 million homes would incur an additional cost of £20,000.

Under the plan, around £1.7 billion would be raised and Mr Miliband intends that to be used to implement a housing benefit.

He added that fees would be more helpful than the government's emergency Budget when it came to helping those who find it difficult to afford housing.

"We've calculated that a mansion tax of one per cent on homes over more than £2 million would more than cover the money that they claim to be saving from housing benefit reforms," he explained.

The Evening Standard reported that, if these plans went through, the Queen might have to pay £9.35 million on Buckingham Palace, as the 775 room residence, which has housed the reigning monarchs since 1837, is worth around £935 million.

Posted by Chris Price

Published 3rd August, 2010

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