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A senior Labour politician has accused Knight Frank of scaremongering after it distributed a leaflet warning home owners of the alleged threat of a future mansion tax.

Sadiq Khan, Labour's shadow London minister and shadow justice secretary, says Knight Frank is attempting to influence the outcome of the May 7 election by its letter, which has gone to residents in the marginal south London seat of Wandsworth.

Estate agents are one of few professions trusted less than politicians and I am shocked that Knight Frank think it is acceptable to scaremonger like this Khan told The Guardian newspaper. Khan also alleges that priot to the last election Knight Frank made a £2,000 donation to the Tories.

It is simply wrong that a company that has donated to the Conservative Party are putting out misleading leaflets about Labour policy in marginal constituencies, Khan says in The Guardian.

The mansion tax is both fair and hugely popular with Londoners. Those with the broadest shoulders must bear the biggest burden and the mansion tax will ensure they do so. This comes down to a basic issue of fairness, he adds.

The Knight Frank letter does not say vote Conservative' nor does it say do not vote Labour' but instead it suggests people may wish to consider how their financial position may be impacted depending on the outcome of the election.

It reads: Ahead of the General Election on 7th May, you will no doubt be considering the implications of the result on your investments and assets. For those with a stake in the upper end of the housing market, the threat of a potential Mansion Tax is one obvious area of focus. We felt you would be interested in this particular issue and the attached insights from our Global Head of Research Liam Bailey.

The report goes on to say: [The] election result will determine the potential for the introduction of a Mansion Tax, or a variant. Anything other than a Labour majority government (current odds 8/1), a Labour/Liberal Democrat coalition (17/2) or a Labour/SNP coalition (6/1) is unlikely to lead to its introduction. The current odds on a Conservative majority are 5/1.

Earlier this year, Estate Agent Today reported that shadow chancellor Ed Balls said on live TV that Savills - the close rival of Knight Frank - was scaring everybody with its speculation about the impact of the mansion tax on the housing market.

More recently, Savills' head of residential research - Lucian Cook - wrote a paper arguing that council tax would be a fairer and more effective alternative to the mansioin tax. His paper was published by a pressure group originally established by Margaret Thatcher.

Comments

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    Now THIS is serious!

    A landlords association has slammed the governments Budget as a nightmare because of its unexpected measures to allow sub-letting.
    The small print of the Budget, released after the Chancellors statement, outlines plans to make it illegal for private sector tenancy agreements to include clauses that prevent the sub-letting of the property.
    The measures on sub-letting are a nightmare in the making and smack of back of the fag packet policy making claims Alan Ward of the Residential Landlords Association.
    Key questions remained unanswered such as who will be responsible for a property if the tenant sub-letting leaves the house but the tenant they are sub-letting to stays
    Similarly, given the government wants landlords to check the immigration status of their tenants, who would be responsible for checking the status where sub-letting occurs
    A landlords association has slammed the governments Budget as a nightmare because of its unexpected measures to allow sub-letting.
    The small print of the Budget, released after the Chancellors statement, outlines plans to make it illegal for private sector tenancy agreements to include clauses that prevent the sub-letting of the property.
    The measures on sub-letting are a nightmare in the making and smack of back of the fag packet policy making claims Alan Ward of the Residential Landlords Association.
    Key questions remained unanswered such as who will be responsible for a property if the tenant sub-letting leaves the house but the tenant they are sub-letting to stays
    Similarly, given the government wants landlords to check the immigration status of their tenants, who would be responsible for checking the status where sub-letting occurs
    He says that while more detail on the proposal will emerge in the coming weeks it is difficult to see landlords supporting it.
    He says that while more detail on the proposal will emerge in the coming weeks it is difficult to see landlords supporting it.

    • 19 March 2015 17:10 PM
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    Nonsense. In what areas would prices have risen up to above the 2m threshold that weren't already affluent and desirable in the past. I'm sure property in Holland Park, Kensington, Chelsea, Knightsbridge would have cost you a fair bit even 30/40/50 years ago.

    And these 2million plus houses aren't ten a penny. They're still concentrated in very well-to-do, upmarket areas. Have you seen what you can get for 2 million, even in London It costs a hell of a lot to maintain a 2 million plus house, so people living in them must have a fair bit of disposable income going spare.

    The idea that 'grannies' and 'grandads' will be hit hardest by this tax is just a cop-out. Where are all these poor, feeble grannies living in these 2million plus properties We never seem to get any actual evidence of them, they're just mythical beings that the Tories and their ilk like to invent to give them grounds for opposing the tax.

    And you say it's both an unfair and unaffordable expense. From what I've read, the amount they'll be hit with won't exactly be crippling. Too much misinformation is being spread around - and estate agents like Savills and Knight Frank are as guilty as anyone of this.

    • 19 March 2015 15:32 PM
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    Claiming that estate agents are even less popular than politicians is a weird boast.
    Would Labour ban them from commenting on their own industry I wonder

    • 19 March 2015 14:45 PM
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    @Algarveinvestor

    '....You don't suddenly go from a modest house to a ridiculously expensive one...'

    Oh no! What do you think has happened to house prices over the last 20/30/40 years etc Many 'old grannies' and 'old grandads' have lived in their current homes for this period of time and they are entitled to live out their time in them without being hit suddenly with an unfair unaffordable expense.
    All taxes should be based on income and income alone.
    Think on.

    • 19 March 2015 11:21 AM
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    Where's that guy who posts his long mansion tax rant under any article mentioning the mansion tax This is two in a row he's not commented on - he's slacking.

    • 19 March 2015 10:21 AM
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    High-end agency Knight Frank in bed with the Tories Never.

    I agree that this is scaremongering. If you live in 2m property, you have a lot of dosh or you've inherited a lot of dosh. Simple as.

    Even in very well-heeled areas of London you can get a lot for under the 2m threshold. Only a very small amount of people live in these types of houses and, given they've got a lot more money than your average person, they should take on a greater financial burden.

    And I don't agree with the defence that lots of old grannies who have been living in their houses for years will suffer. You don't suddenly go from a modest house to a ridiculously expensive one.

    • 19 March 2015 10:15 AM
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