Founder of Black Brick to visit Dubai and Riyadh

20% of company’s clientele originated from ME, including its largest dealer this year

Camilla Dell, Managing Partner and Founder of Black Brick, a premier buying agency specializing in London real estate, is gearing up for a notable visit to Dubai and Riyadh in November. This strategic trip aims to connect with Middle Eastern investors and shed light on the enduring appeal of London’s property market, even amid shifting economic landscapes.

London continues to capture the interest of Middle Eastern buyers, thanks to its rich cultural scene, world-class educational institutions, and robust investment opportunities. Despite the recent UK budget, the impact on many Middle Eastern investors has been minimal. Most buyers of UK real estate from the Middle East do not plan to become residents in the UK, so the proposed modifications to the UK Resident Non-Domicile tax regime hold limited relevance for them. Additionally, London’s temperate climate offers an attractive escape from the scorching Middle Eastern summers, further boosting its appeal as a destination for second homes.

One change that will impact all buyers of second homes, is the increase in the Stamp Duty surcharge (irrespective of whether the buyer is British or international) which was increased by 2 per cent in last week’s UK budget with immediate effect. This means that, depending on property value and buyer nationality, buyers of second homes will pay up to 19 per cent over the value of their home in buying tax.

Black Brick believes the prime London market will be able to absorb the tax changes. Managing Partner Camilla Dell comments, “I don’t believe an additional 2 per cent will deter someone from wanting to buy a property in London. On a £2 million purchase the additional tax equates to just £40,000. I think that in the very short term, between now and Christmas, things could be a bit slow,” she said.

“It will take a bit of time to feed into peoples’ psyches and there may be buyers who attempt to negotiate a 2 per cent price cut to cover the higher tax. But it does not fundamentally alter why people like to buy property in Prime Central London (PCL). As with previous rises in Stamp Duty, we expect the ultimate price for the rise to be paid for by the seller. History has shown that when Stamp Duty goes up transactions slow down while reality sinks in. Prices then fall in line with the rise, and sometimes overshoot it.”

As a result, Dell expects to see more standoffs between buyers and sellers over who will cover the extra tax. “At Black Brick we are already embarking on some tough renegotiations for clients under offer and not yet exchanged to take into account the additional 2 per cent.”

“With weaker market sentiment, we are seeing a dynamic market shift that presents significant opportunities for buyers,” said Camilla Dell. “This year, Black Brick has achieved an average saving of 9 per cent off asking prices for our clients, compared to 6 per cent last year. Recent data from Knight Frank indicates an 18 per cent drop in £5m+ transactions in the year to September. With an increase in new listings, buyers have an abundance of options and now hold a strong position in the market. This shift marks a buyers’ market that hasn’t been seen in years.”

In a positive move for the UK property market, UK Chancellor Rachel Reeves decided against hiking Capital Gains Tax for buy to let investors – a widely anticipated move which sparked an exodus of landlords from the sector over the summer.

There could also be a silver lining for investors buying multiple properties.

“Interestingly there’s been no change at all to “the rule of six”,” said Dell. “Investors buying six or more properties, or a property that is classed as mixed use – with residential and commercial uses – still benefit from significantly lower Stamp Duty rates of just 5%. I expect to see more interest from bulk investors taking advantage of the current buyers’ market, particularly from Middle Eastern investors who like this kind of investing. Bulk investors enjoy a series of benefits beyond Stamp Duty: control over their running costs, the opportunity to sell a building if the need arises, or to break it up and sell flats individually, and the ability to negotiate a better price.”

“At Black Brick we’ve successfully negotiated as much as 20 per cent from asking prices on bulk deals from developers,” said Dell. “And with rents rising and yields improving, this sector is looking more attractive, particularly for freehold blocks.”

This year, nearly 20 per cent of Black Brick’s clientele has originated from the Middle East, including the company’s largest deal of the year: an exclusive off-market country estate transaction valued at approximately £42 million.

As part of her visit, Camilla Dell will co-host two high-profile events in Riyadh. On November 12, she will collaborate with HNW Advisor Events to host an exclusive gathering that will provide high-net-worth individuals with valuable insights into the London property market. On November 13, she will co-host a distinguished lunch event at the Intercontinental Hotel alongside Forster’s Law Firm and Barclays Private Bank, fostering in-depth discussions on UK investment opportunities.

Navigating London’s competitive real estate market, which boasts over 7,000 estate agents, requires expert guidance. Black Brick stands out for its ability to provide clients with tailored advice and access to off-market properties, with nearly 50 per cent of deals sourced beyond traditional channels. Camilla Dell is eager to meet with investors in Dubai and Riyadh, offering them unparalleled insights and support in navigating one of the most complex and dynamic real estate markets in the world.

Read the full article here.

US Election 2024: How Donald Trump’s win will impact London’s property market

By Anna White

Requests to rent trophy homes went up overnight while, longer term, a Trump victory could pump up the deflated central London sales market

The phones of London’s high-end estate agents have been ringing overnight. Enquiries from anti-Trump Americans to rent trophy homes on London’s most prestigious streets started to come in during the early hours of Wednesday morning as a Donald Trump victory seemed inevitable.

“My team have been up most of the night fielding enquiries from many of the US cities that we work with, including New York and Los Angeles,” says Becky Fatemi of Sotheby’s International Realty. “The most immediate requests are for rentals. They want wide-fronted townhouses in Notting Hill or large lateral apartments in buildings with a porter, such as the Peninsula. We expect to see this demand continue,” she adds.

James Gow, head of London residential sales for Strutt & Parker, believes this activity will bleed over into the sales sector too in what is known as Prime Central London (PCL), and boost this micro-market – which is small in footprint but large in value for the UK economy.

“Trump is such a polarising figure that there will be some wealthy Americans who will just think, ‘I do not agree with his rhetoric and I just cannot be a part of it,'” Gow says.

Sentiment is the main driver in the PCL market as these buyers are so wealthy they are rarely forced to move, Gow continues. Due to constraints on new developments and many buildings used for other purposes – such as embassies – there is historically a lack of supply of homes in the most prestigious pockets of Westminster and Kensington and Chelsea. “Therefore, an influx of Americans buying up homes with create a swing in sentiment and momentum and could move prices up too. A Trump win could be good for the London market” he says.

US buyers have been here all year

North American buyers have been preparing their property portfolios and location in the lead up to the US election this November. Even when other international buyers dropped off over the course of 2024 due to uncertainty around the UK change in government and taxation levels, US buyers have still been property shopping in London.

US buyers were the top non-UK visitors to the Savills website this August and over the last year have accounted for 14 per cent of deals.

Buying agent Liam Monaghan of LCP Private Office has seen an “uptick” in American buyers in 2024 with nearly a third of buyers coming from North America. “The US election is a polarising event and therefore has driven some US clients to think about their worldwide holdings carefully. It is sensible to have a foothold in both camps as they monitor the political landscape and financial markets,” he says.

They are shopping for period properties with charm and traditional features but are modernised inside with state-of-the-art fixtures – or as Fatemi calls it “turnkey” aka ready to move straight into.

“We recently fully refurnished a top floor flat in Notting Hill for an American buyer who loved the character of the building but wanted a complete internal renovation to modernise throughout. They also favour new build schemes with all amenities onsite – of late US buyers have bought in the Old War Offices in Westminster and Regents Crescent with views over Regents Park,” Monaghan adds.

A new, mobile generation

Historically, wealth generated in American stayed in America, explains Savills’ Rory McMullen. Now there is a new more mobile generation of wealth. Younger individuals and families who have made money through tech, crypto, venture capital and private equity. With more remote working and a change in attitude after covid this generation is more mobile. “London has seen this migration of young US wealth over the last few years,” he explains. “It is a trend that is set to continue.”

“They often rent first buy later, known as ‘try before you buy’. Rental stock in the centre of London is so constrained that any influx is set to increase rents once again. “I have seen a significant increase in enquiries for both short- and long-term rents in the run up to the US election, particularly from families in New York. We saw an influx in 2016 when Trump won – we are expecting to this this again,” says Olivia McSweeney of Sotheby’s International Realty.

London as a safe haven has not changed

Some will see the Trump win as unsettling back home and it will motivate them to move. But there are many other factors pushing US buyers into London and the UK’s country house market, according to buying agent Camilla Dell of Black Brick.

She cites the strong dollar against the pound, falling prices in PCL, the British high quality education system and the perception of safety as factors which continue to appeal to US high networth individual.

“We worry about crime here but it is not comparable to gun crime in the US. We are sending children into school through the school gate and not through metal detectors. After covid there is also a huge homelessness crisis in cities such as New York and drug taking on the streets is rife,” she says.

For Gow, the safe haven status of London remains its major selling point at a time when the Trump win will breed further unrest in the US. And, while conflict is raging in the Middle East and Ukraine there is renewed certainty in the UK.

“2024 has been like driving down the motorway in the fog, you drive slowly peering through the windscreen. But the UK and the US election are down now – we have certainty and visibility which should translate into a busy market in the New Year,” he concludes.

Read the full article here.

How will Labour’s 2024 Budget impact the property market?

By Anna Solomon.

On 30 October 2024, Labour set out its fiscal plans for the year ahead. Expectations of clampdowns on multiple homeowners, with breaks for the poorest in society, had been swirling. Aspiring homeowners hoped for a silver bullet to help them get onto the property ladder.

When it came to housing, Chancellor of the Exchequer Rachel Reeves’ 2024 Budget was, for the most part, passive, with few meaningful implications for the wealthy and little relief for first-time buyers. However, Labour did arguably deliver on its promise to help vulnerable families, pledging £5 billion of investment for affordable housing.

Here, we delve into the particulars of exactly what the statement means for various groups, and how it plays into an overall picture of a housing market slowly but surely recovering from interest rate hikes and other challenges.

Homeowners

Autumn is typically a busy time for transactions, and this year has been no different, with Rightmove reporting that sales are up 29 per cent compared to the same time last year. “Whilst there is still optimism that interest rates will lower even further, buyers seem to have settled into the new normal of higher rates than what we had been experiencing for over a decade,” says Lisa Simon, head of residential at Carter Jonas.

Supply is also up, with the number of homes currently for sale 12 per cent higher than in autumn 2023. While activity is healthy, Rightmove did record lower-than-average price growth in October, illustrating that sellers still need to set a realistic asking price to find a buyer.

At the prime end of the market, buyers are having their moment, says Tom Kain, a partner at buying agent Black Brick, citing “a growing level of data showing conditions are improving for buyers of property over £2 million”. “Anyone who bought within the last 10 years is finding it hard to make their money back if they are re-selling, and asking prices are dropping and bigger discounts are being negotiated,” he says, adding: “In some areas, like the catchment areas of top-rated state schools, it may be a good time to sell.”

The prime market is generally more resilient to fluctuations, as a smaller percentage of these homeowners have debt on their property. “Luxury properties will always be in high demand, as evidenced by the volume of high-value transactions that have happened this year,” says Samuel Richardson, head of sales at Carter Jonas. “International buyers continue to place confidence in the prime London market’s position as a safe place to invest.”

Second-home owners and landlords

Perhaps the most notable measure announced in the Budget was the two per cent stamp duty increase for second home purchases. The surcharge rose from three to five per cent, which amounts to an additional £10,000 on a property of £500,000. While this may give some second-home buyers pause for thought in the short term, and may result in some deals falling through (buyers will now have to raise an additional £7,000 if they are buying an averagely-priced UK home), the charge is likely to become just another that second home-buyers become accustomed to.

This is especially true as, historically, stamp duty increases have had a downward effect on prices, Kain points out. The value of stamp duty is likely to simply be knocked off asking prices. Richardson agrees, recalling the three per cent stamp duty hike for second homes brought in in 2016: “This had relatively little impact on the central London market, in fact, the annual growth that year was 8.1 per cent.”

The stamp duty increase is manageable. What would have been less palatable for second-home owners would have been an increase to capital gains tax (which is paid on any profit made from the sale of a property). For those who own property as an investment, therefore, the overriding response to the Budget is likely to be one of relief.

Renters and first-time buyers

Little relief was offered to those aspiring to get on the property ladder. Mortgage rates remain high, rents remain high (hindering people’s ability to save for a deposit), and the Budget made no mention of an extension to the current stamp duty relief for first-time buyers, which is due to end in March 2025. At the end of March the threshold at which first-time buyers do not pay stamp duty is likely to fall from £425,000 to £300,000. According to Hamptons, 37 per cent of first-time buyers currently pay stamp duty in London; by April this will have risen to 71 per cent.

Further, there are fears that the additional stamp duty might deter small private landlords from adding accommodation for tenants, leading to further rent rises. That said, Simon believes the opposite may be true: “Legislation that hinders investment from second-home owners, leading to many choosing to downsize or entirely get rid of their property portfolio, may mean that more options may come to the market for first-time buyers.” A realistic assessment of the impact of the stamp duty increase for second-home owners on first-time buyers, therefore, is that it will be negligible.

A small consolation (especially as banks are already doing this) comes in the form of the rebranding of the Mortgage Guarantee Scheme as Freedom to Buy – the government’s guarantee to lenders against 95 per cent mortgages so that first-time buyers only have to find a five per cent deposit.

The verdict

Arguably, the winners of the Budget are vulnerable people, with Labour setting out hard targets for affordable housing. Meanwhile, those at the top remain relatively unscathed, which could and should be considered a win for them. It’s those in the middle who lose out. However, one thing that can be said with certainty about the Budget: the fact that it is now over will bolster the market. Reeves’ statement has put to bed a period of uncertainty, meaning that transactions can now forge ahead with confidence.

Read the article here.

Why imposing indiscriminate tax hikes is a short sighted approach

By Camilla Dell for PrimeResi.

As a ‘painful’ Autumn Statement looms, Black Brick boss Camilla Dell shares her views on what the Chancellor should address.

Ever since Sir Keir Starmer stepped into the Downing Street garden and issued a warning that the forthcoming budget would be “painful”, commentators have been predicting a whole range of possible tax raids, writes Camilla Dell.

Black Brick’s view is that imposing indiscriminate tax hikes is a short sighted approach. What a Government looking for growth, prosperity, and a healthy, active housing market should be doing is encouraging people to buy, sell, invest, and, most of all, remain in the UK.

Capital Gains Tax

It is widely anticipated that CGT for second home owners and landlords will be increased from a current maximum rate of 24% to up to 45%. Across the UK, landlords have already begun voting with their feet and selling up – Rightmove has revealed that almost one in five of homes currently for sale has previously been rented, compared to 8% back in 2010.

But CGT is only the latest travail to have hit UK landlords in recent years – they have already endured the phasing-out of mortgage interest tax relief, tighter rules on tenant evictions, and more onerous safety regulations.

And this gradual squeeze has had unintended consequences which have rippled right through the housing market.

George Osborne poured glue into the housing market when he increased stamp duty and ended landlords’ right to have a mortgage as a tax deductible expense.

George Osborne poured glue into the housing market when he increased stamp duty and ended landlords’ right to have a mortgage as a tax deductible expense.

It did not solve the housing crisis and it has created a really bad environment for renters. There is not enough supply, build to rent has not filled that void, and landlords have just been battered in the press when most of them are providing an excellent service. You have now got dwindling supply and that is a really bad thing.

In Cornwall, Anna Sharp of Black Brick’s country department, is particularly concerned about second home owners, who are simultaneously being hit with Council Tax surcharges, and the end of the furnished holiday lettings tax regime, which had excluded them from the end of interest rate relief.

“All of this is affecting investment buyers,” she warned. “Holiday let bookings are down 37% in Cornwall this year, so change would have occurred naturally. This is forcing a lot of people to sell, but will not solve the housing crisis in Cornwall, because a lot of these homes are priced above £500,000 and local buyers are not able to afford them.”

Non Doms

One change the Government has already confirmed is a dismantling of the Non Dom tax system, which currently allows high net worth individuals to live in the UK and pay tax on their UK income only. Despite this, the latest data shows that in the 2022/23 tax year the 74,000 Non Doms paid, collectively, £8.9bn in tax.

“If we get rid of Non Doms, we are just waving that off,” said Tom Kain, a Partner at Black Brick.

Let’s hope that Rachel Reeves is now finally listening to tax experts. Rumours are that the Chancellor is now considering watering down the changes amid concerns it will raise no money.

Inheritance Tax

The other big issue is IHT, currently charged at 40% of estates worth more than £325,000. In reality, however, there are many exemptions and only 5% of deaths are taxed in the UK, often at much lower rates. Older homeowners have been particularly spooked by the prospect of paying more and, possibly as a result, another trend highlighted by Rightmove has been a surge in the number of large houses for sale. “I definitely saw this trend emerging in the last year of people who probably should have moved in their late 70s and early 80s but had put it off because of the pandemic starting to downsize,” said West Country specialist Rupert Stephenson, of Black Brick’s Country & Coast Department.

“They wanted to quickly pass on their wealth to their children.”

Stamp Duty

Black Brick’s Rupert Stephenson thinks that pushing older homeowners out of their homes with the threat of higher taxes is unfair. A more humane, effective alternative would be to use less stick and more carrot.

Late last month, the Organisation for Economic Co-operation and Development (OECD) called for Stamp Duty, which it argued hinders people from moving to pursue better job opportunities or downsizing, to be scrapped.

Stephenson thinks that getting rid of Stamp Duty for both downsizers and first time buyers would get the property market moving again. “It would be good for the economy as a whole – house builders, white goods purchases, you name it. Downsizers need to be encouraged, but punishing them with tax is social engineering. People want stability, not loads of changes all the time.”

Read the article here.

Our warning against the Government ‘social engineering’ downsizers

West Country buying agent Rupert Stephenson, of Black Brick’s Country & Coast Department, spoke with Marc Shoffman, of Estate Agent Today, to share his insights into how the Government is impacting the current UK property market.

Reflecting on the tax rises and IHT reforms expected to be announced in the upcoming Autumn Budget, Rupert commented that older homeowners have been especially spooked by the prospect of paying more, and suggested that this could lead to an increase in larger homes being put up for sale.

“I definitely saw this trend emerging in the last year of people who probably should have moved in their late 70s and early 80s but had put it off because of the pandemic starting to downsize. They wanted to quickly pass on their wealth to their children.”

Read the full article here.

US Election 2024: how Donald Trump’s win will impact the London property market

Speaking with Anna White in The Standard this week, Black Brick Founder and experienced Buying Agent, Camilla Dell shares her thoughts on just how much Trump’s presidential election win will impact the central London property sales market in 2024 and beyond.

Read the article here.

The race to sell second homes before Labour puts up Capital Gains Tax

Black Brick buying agents Rupert Stephenson, of the West Country branch, and Anna Sharp, of the Cornwall Branch, spoke with David Byers for a new piece in The Times this week that reflects on how expectated tax rises in the Autumn Budget are causing chaos in the property market.

“Some holiday homes that have been in the same family for generations are now coming up for sale as people not only worry about CGT but also have been affected by the change in holiday let tax relief and landlord relief that was imposed by the last government.” Rupert said, including “a number of prime estates, farms, and coastal properties”, particularly around Exeter and Salcombe in Devon, ranging between £4 million and £10 million.

Meanwhile just up the road, Anna shared that as international travel has increased, UK holiday bookings are down by around 37% in Cornwall. Combined with soaring mortgage rates, this trend has majorly impacted investors’ pockets. “For many, it is no longer a viable business transaction, with the yields simply not adding up,” she said.

Read the full article here.

Why London’s mansions are struggling to sell

London’s most luxurious properties aren’t getting snapped up so quickly at the moment. But why?

For the priciest properties this year, “sentiment is significantly down”, Black Brick Founder & London Buying Agent, Camilla Dell shared, adding: “The current market reminds me a little bit of the financial crisis in terms of what I’m seeing in terms of the volume of stock available, price reductions and nervousness in the market from vendors.”

Read the full article in Bloomberg.

The eight most unwelcoming places to buy a second home in the UK, plus the eight villages where you can buy a stunning property AND be embraced by locals

In a new article for The Daily Mail this week, Black Brick Buying Agent Rupert Stephenson shares which areas in the UK he, as an experienced Buying Agent for Devon, Dorset and Cornwall, believes are the most beautiful and welcoming places for people to buy their second homes

“‘”The people of Dartmouth, being a naval base, are used to newcomers and the locals are very welcoming,” he said. “Newton Ferrers on the estuary of the River Yealm has two good pubs and a post office. It is a community of incomers and everyone gets along extremely well.”

Read the full article here.

Nine things that are affecting your property value

In a new article for House & Garden this week, the Black Brick buying agency team joins The List’s panel of property experts to discuss the factors people should consider before investing in property.

“Flats with high ceilings and great views will always command premiums so it’s important to understand this before making an offer,” our team said. “Agents and valuers always focus on price per square foot/meter but volume is hugely important when determining value. For example, a first-floor apartment on Eaton Square with over three-metre ceiling heights can trade for fifty per cent more than flats on other floors.”

Read the article here.