London housing transactions plummet 18% as Brexit, stamp duty, and mortgage rules bite – Business Insider

The strong results meant the company revised its pre-tax profit guidance to £3.3 billion from £3 billion, but it said 2017/18#8217;s results would be a #8220;peak#8221; before returning to normal returns in 2018/19.

#8220;Brexit uncertainty and concerns over growth and inflation, coupled with the changes to SDLT (stamp duty land tax) and mortgage interest deductibility, continue to impact the market.#8221;

Berkeley#8217;s caution reflects wider concerns about the capital#8217;s housing market, where decades of runaway price growth is seeing affordability stretched to breaking point. Estate agents Savills predicts London house prices will dip 2% next year despite rising nationally.

The group posted strong profits but warned of a tough outlook next year, as Brexit and inflation bites.

The firm said factors driving the slowdown in transactions included stamp duty hikes, uncertainty surrounding Brexit, and a tax change which means landlords from 2020 will no longer be able to deduct mortgage interest costs when they calculate taxable profits.

Transaction volumes in London, the number of houses being bought and sold, have dropped 18% since last year, according to housebuilder Berkeley.

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