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Progressive property taxes & house building are simultaneously needed to increase home affordability. The chronic supply shortage must end. People in houses over (as low as) £1m need to pay a much higher tax than the ones in £300k ones.
The price bubble is fuelled by fierce restrictions on building new homes in London. No land made available, no regeneration of residential estates, no vertical building allowed. A typical "terraced house estate" would contain 5 times more flats if 6 floors would be erected, and the cost per square foot of dwelling would decrease significantly.
The cost of owning an abnormally expensive house should go up so that speculation dies off. The government would use the collection of these taxes to stimulate supply and improve access to houses hence the median (and not the irrelevant average) price goes down. Even the banks would benefit because the median income could better cover the payments for lower mortgages, hence the risk will be low and the volume will go up. Supporting high mortgages with taxpayer money is nonsense.
Taxing only the transactions does not address the fundamental issues of the property market.