Residential Land Press and Media Section

Stamp duty rises are having unforeseen effects on the lower end of the residential market

Bruce Ritchie, CEO and Founder of Residential Land, talks to Property Week and CITY A.M about the impact of a Stamp Duty on the Residential market.

property week - Residential Land






In recent years we have had the perfect storm of tax changes in residential…

From the introduction of annual tax on enveloped dwellings to offshore capital gains tax, from clampdowns on corporate vehicles buying property to the removal of buy-to-let relief and even the prospect of base erosion and profit sharing imposed by the Organisation for Economic Co-operation and Development.

But there is one change that threatens to tip the market over the edge: the sharp rises in stamp duty that were introduced in December 2014 – and in particular the 12% rate introduced for properties of more than £1.5m.
The principle underpinning UK home ownership is that you do not pay tax on the gains on your principal primary residence over the long term. However, with the new stamp duty levels this has changed. Imagine you are a homeowner who 10 years ago bought an apartment for £1m; you have spent more than £500,000 on it; and it is now worth £2.5m.

You have technically made a £1m gain over the 10 years. However, now anyone looking to buy your home is likely to discount their offer by up to £300,000 to take into account the new stamp duty rate.

This is the equivalent of 30% tax on the profit you have made, not taking into account the 12% you will pay to acquire your next £2.5m home. Big purchase tax numbers that are not obviously wrapped up in the value of real estate scare purchasers away.

Since the stamp duty changes, the London market has cooled considerably between £5m and £10m, less between £2.5m and £5m, and is continuing to hold its own but with reduced volume in the £1.5m to £2.5m bracket. Some might say this was the chancellor’s aim, to slow the market and bring in revenues. However, there are consequences.

Unintended consequences

While moving to a ‘slab’ system of stamp duty was designed to harvest more tax from relatively wealthy property owners, the unanticipated consequence will also be to limit supply of affordable homes for the less well-off.

Bruce Ritchie

This is because the profit generated on flats of £1.5m-plus on a large development funds the affordable housing that is also built as a result of the development. Put simply, higher stamp duty at the top end is choking off the supply of affordable housing, with the result being that fewer homes overall are built.

Another unintended consequence of the stamp duty changes is that developers are stepping up the supply of one-bedroom units that fall beneath the £1.5m limit, distorting the mix of homes supplied.

Substantial reductions in the volume of sales inevitably lead to reductions in price because not everyone has the luxury of time when they need to sell, and these price reductions will threaten loan-to-value covenants and ultimately create banking credit risk.

At the same time, it seems odd that none of the above measures have been used to tax commercial real estate. At present an offshore individual can invest, via a corporate vehicle, in commercial real estate, sell either the asset from that vehicle or the vehicle itself and pay no tax in the UK on any profits made (not the same for residential). If we are to build more homes, then a level playing field is the minimum standard of parity one would expect.

As the figures for the end of 2015 come through, the 30% fall-off in sales volumes experienced by properties in excess of £1.5m will have far-reaching consequences.

A major consequence of the high stamp duty charges of more than £1.5m is that the average prices for properties priced at less than £1.5m are moving up more rapidly.

This, too, is not in the best interests of the country, with double-digit growth in the London midmarket being spurred by the unintended difference between the two upper bands. A reduction in the gap in stamp duty with the level above £1.5m could calm this effect.

It is clear that the chancellor has succeeded in cooling the market, but the figure of 12% was an overshoot and should be reassessed to 9% between £1.5m and £6m. Unless the chancellor wants to see his overall stamp duty take continue to fall, he will adopt this measure in his 25 November Autumn Statement.


Residential Land features in ‘London’s most luxurious rental homes’

Residential Land is featured in the Evening Standard’s, Homes & Property article, ‘London’s most luxurious rental homes’. Out of the 23 properties, you can find Residential Land’s properties in the first 3 slides.

London's most luxurious rental homes

London’s most luxurious rental homes

London’s most luxurious rental homes >>

The properties being showcased are:

Merchant Square
Located in the historic Paddington Canal Basin, 4B Merchant Square is a contemporary apartment building with 60 prestigious 1, 2, 3 and 4 bedroom apartments set over 15 floors now available to rent. 

Kew Bridge Court Eco Houses
Each home has been designed with the environment in mind and offers the latest in technology to allow a cost efficient solution to running the home. The houses include solar panels, extensive insolation, green roof gardens, ventilation systems, underfloor heating, hot taps in the kitchens and security systems.

Residential Land complete on Hamlet Gardens

Residential Land is pleased to announce the purchase of Hamlet Gardens in Hammersmith, west London. This red brick Victorian Mansion block consists of 122 luxury flats and is set at 95,000 sq ft.

Hamlet Gardens flats to rent Residential Land

For further information, please read the below article that was covered in Property Week:

property week - Residential Land





Residential Land primed to buy luxury flats in London
By Hannah Brenton

Hamlet Gardens, Hammersmith, London
The residential investor has agreed to buy the 95,000 sq ft Hamlet Gardens development from Swedish investor Akelius for around £95m.

The purchase amount reflects a price of around £1,000/sq ft across the scheme near Ravenscourt Park.

The private rented sector specialist has been on an acquisition spree since securing further backing from Canadian pension fund giant Ivanhoé Cambridge for a fifth Residential Land fund in February.

The new £650m fund is focused on a broader area of prime central London, and its upper price point for investment has increased from £1,500/sq ft to £1,650/sq ft.

In June, it snapped up Chase New Homes’ residential scheme at Palace Wharf in Fulham at £1,250/sq ft – in a deal worth approximately £37m – as well as a luxury 60-flat scheme at 4b Merchant Square, Paddington, for £60m from Native Land and Malaysian investor Amcorp.

Akelius has renovated the majority of the properties at Hamlet Gardens since purchasing them from an arm of the Royal Bank of Scotland for more than £40m in 2013.

Three final phases are still being renovated but these have been forward-purchased by Residential Land and are included in the purchase price.

Similar flats in the area have recently sold for as much as £800,000.

“We believe that there will be growth in the area around Ravenscourt Park and are pleased to have invested another £100m in the prime central London market,” said Ritchie. 

Fighting talk ahead as property heavyweights prepare to square up

Residential Land have been mentioned in the Evening Standard ahead of the Props Breakfast in October hosted at the Dorchester, London. This year Bruce Ritchie CEO of Residential Land & Michael Slade CEO of Helical Bar will partake in a live Commercial vs Residential debate hosted by Emma Crosby.

Michael Slade has for a number of years run one of the most successful public property companies whilst Bruce Ritchie runs one of prime Central London’s largest residential landlords who are making a significant impact in the sector. With London and residential being hot topics in real estate at the moment

Props breakfast 2015

For the article, please read below:


Fighting talk ahead as property heavyweights prepare to square up

The first rule of Fight Club is, you do not tweet about Fight Club — that’s how it goes, right?

Well obviously someone’s been breaking the rules, as Spy spots #FightClub creating waves on Twitter. Was it Ed Norton and Brad Pitt bemoaning the demise of the Fail Whale?

Alas not. It was property types getting excited about a Props charity debate between Mike Slade of Helical Bar and Bruce Ritchie of Residential Land, slated for the Dorchester in October. The pair will thrash it out in a commercial real estate v residential debate, a third speaker — Robert Paulson — is as yet unconfirmed.

Bruce Ritchie talks to Estates Gazette on the hot topic of price per sq ft in London

Bruce Ritchie, CEO of Residential Land, talks to Alex Peace at Estates Gazette on the findings from their London Residential Research team, showing that price per sq ft in London has been driven through the £1000 per sq ft mark, not only in Prime Central London areas but the fringe areas surrounding it as well.

Bruce Ritchie explains: “Prime Central London has not resolved its supply problems and is not creating enough new product. Too much demand from both domestic and international, for what it is we have, both for sale and being built and that is pushing prices in the upwards direction.”

To listen to more, click the play button on the podcast below:

Bruce Ritchie talks to Estates Gazette

Click here to read the full article >>

Nobody wants to be seen as token

Emma Whitby-Smith, Head of Investment at Residential Land talks to Estate Gazette about diversity within the property industry.

Emma Whitby-Smith, Head of Investment

Emma Whitby-Smith, Head of Investment

When I first started in the property industry 30 years ago, diversity on any scale didn’t really exist, or if it did, it wasn’t high on the list of management priorities.

Any industry that is reliant on building relationships needs people who are representative and have a broad mix of gender, sexual orientation, race, religion, personalities and opinions. Thankfully, on the whole, the working environment has changed in a positive way in the past ten years. While there is always scope for improvement there is certainly broader diversity at senior levels in the property industry.

But diversity is not a buzzword. There is a difference between “complying” and truly understanding. Nobody wants to be viewed as a token individual within a company.

Employers should understand that employee welfare is a priority, and should review company policy regularly and engage with employees at all levels to improve working relationships. An individual who feels accepted, included and understood will in turn be happier and feel more valued. Understanding business is understanding people.

The London property industry is embracing diversity and companies are taking huge steps to introduce and improve diversity programmes. Freehold’s work has been a game-changer. The LGBT property networking group holds monthly events hosted by industry giants such as British Land, Savills, Cluttons, JLL, Shaftesbury and RICS, to name but a few. These respected companies understand that diversity is not about fixing a problem – it is about ensuring business sustainability and improved performance.

I can of course, only comment on the London property scene; other areas in the UK are sadly not as progressive. It is even worse in other countries.

While my sexuality doesn’t define me, it is absolutely an integral part of who I am and it is an enormous relief I can be honest about the fact I have a long-term female partner with my colleagues and associates. Twenty-five years ago, I would have thought twice about being so open for fear of prejudiced assumptions or worse.

People have been discriminated against, and sadly continue to be so, for no other reason than for being different. I have the support of my chief executive, who values my contribution to the company and respects me for who I am. He recognises that a one-size-fits all approach to managing people does not achieve fairness and equality for everyone.

People have different needs, values and beliefs. Good management demands fairness and equality but also flexibility and inclusiveness.

Read the article on the Estates Gazette website here.

Residential Land buys 4b Merchant Square, Paddington

Residential Land can confirm that it has bought 60 luxury flats for long leasehold at 4b Merchant Square, Paddington. For further information please read the article by Estate Gazette and Property Week below.

EG - Residential LandRitchie buys Paddington PRS block

Bruce Ritchie’s Residential Land has bought a block of 60 luxury flats in Paddington, W2, for £60m from Malaysian investor Amcorp.

The privately rented residential block at 4b Merchant Square forms part of the 1.8m sq ft mixed-use scheme developed by European Land, a joint venture between the Reuben brothers and Bruce Jarvis’s family trust.

4b Merchant Squiare - Residential Land

60 flats in 4b Merchant Square – Residential Land

The deal comes as European Land is preparing a potential £250m sale of the three remaining development sites at Merchant Square, including the proposed residential tower nicknamed the Cucumber.

Ritchie plans to rebrand and reposition the flats to boost their rent roll to £2.7m. He said: “We are pleased to have made this strategic purchase at a time when West End Green [the 600-home project on Edgware Road being bought by Berkeley Homes] is finally moving forward and European Land’s plans for the Merchant Square Cucumber are also coming to the market.”

Amcorp acquired the building in 2013 from the Crown Estate for £47m. It financed the purchase with a loan from Singapore’s United Overseas Bank. The facility has now been carried over to Residential Land in one of the first such instances of a UK operator securing funding from UOB, according to Ritchie.

The deal follows Residential Land’s acquisition of Palace Wharf in Fulham, SW6, for £37m, taking the company’s prime London rental portfolio to more than 1,200 homes.

Residential Land is backed by Canadian pension fund Ivanhoé Cambridge.

By Alexander Peace, Estates Gazette | Residential | 26-06-2015 | 08:00


Residential Land featured in Property Week

Residential Land featured in Property Week




Residential Land swoops on £60m Paddington block
Bruce Ritchie’s Residential Land has acquired a luxury flat scheme in Paddington for £60m.

The 60 unit block at 4b Merchant Square was bought from Native Land which is backed by Malaysian investor Amcorp.

The building forms part of a 1.8m sq ft European Land scheme which includes the Cucumber.

Residential Land will undertake a programme of refurbishment at the site which is around five years old.

Native Land acquired the building in 2013 from the Crown Estate for £47m.

Residential Land goes offplan in west London

Residential Land is proud to announce that it has completed on Palace Wharf, a deal for a riverside scheme in Fulham that has planning permission for 27 residential units.

For further information please read the article in Property Week below or follow the link to read it on the Property Week website

Ritchie’s Residential Land goes offplan in west London

Bruce Ritchie’s Residential Land has completed a major off-plan residential purchase in west London, after taking advantage of a lull in the Asian forward-sales market.

Backed by Canadian pension fund giant Ivanhoé Cambridge, the private rented sector (PRS) specialist has forward-purchased Chase New Homes’ scheme at Palace Wharf in Fulham at £1,250/sq ft – with the deal worth around £37m in total.

Palace Wharf, Fulham

Palace Wharf, Fulham

The site, near the famous River Café, has planning consent for 27 residential units, comprising five townhouses and 22 flats. “We see that to fulfil our stock requirements we need to be buying new as well as existing [stock],” Residential Land chief executive Ritchie told Property Week. “There’s an opportunity while Asian markets cool for us to replace that Far Eastern buyer with investor money, PRS money, rather than ‘export money’.”

The deal is Ritchie’s first off-plan purchase with Ivanhoé Cambridge and comes after Ivanhoé invested in a fifth Residential Land fund in February. The new £650m fund is focused on a broader area of prime central London, and its upper price point for investment has increased from £1,500/sq ft to £1,650/sq ft.

As well as buying the Fulham scheme, Residential Land has sold a £47m residential block in Marylebone to a group of Middle Eastern investors. Elliott House, 1 Molyneux Street, has been sold to developer Coronado – with backing from Shariah-compliant Al-Rayan bank.

Residential Land had already stripped out the building after receiving planning permission in 2012 to increase the size of the 1930s block from 28,500 sq ft to 35,500 sq ft – increasing the number of flats from 23 to 31.

Coronado will now take over the redevelopment to create the enlarged building, with Residential Land exiting at a price of £1,650 on the existing square footage.

Ritchie said it was a sign Shariah-compliant purchasers were becoming more comfortable with development.

RESI Awards 2015

Residential Land was recently featured in a Property Week article about the Resi Awards 2015.

Residential Consultancy Practise of the Year winner Savills and Residential Land CEO Bruce Ritchie

Savills stood out for the judges, who noted that 30% increase in turnover and 9% rise in fee income. Instrumental in the development of the Private Rented Sector  (PRS) and active in the Student Housing sector, the firm was also praised for its ” conception to crematorium” range of services and for having the largest commercial valuation practice in the UK. ” They are leading the built-to-rent sector advisers” said the judges.

Highly commended Delloite Real Estate Praised for “coming at things from a different angle” and its work as lead adviser to the National Grid and Berkeley on their St William joint venture, launched in November.


Residential Land headline sponsors of RESI Awards for fourth year in a row



As headline sponsors of the RESI Awards 2015, Residential Land CEO Bruce Ritchie opened the awards with a short introduction.


Residential Land were headline sponsors for the RESI Awards on Wednesday 13 May 2015 for the fourth consecutive year.  Property Week RESI Awards was another huge success and saw over 1200 property professionals fill the Grosvenor House Hotel, Park Lane.

The awards are a fantastic opportunity to recognise excellence within the residential property industry

and celebrate the successes of that year. The event is an extension of the popular annual RESI conference, and has instantly established itself as an equally important networking event for the residential property sector.

Residential Land would like to say a very well done to all of this year’s winners!

This year’s winners included:

Residential Consultancy Practice of the Year – Savills (Sponsored by Residential Land)

Ritchie also presented the award for Residential Consultancy Practice of the Year which was awarded to Savills.

Ritchie presented the award for Residential Consultancy Practice of the Year which was awarded to Savills.

International Sales Agency of the Year – JLL

UK Sales Agency of the Year – Savills

Letting Agency of the Year – Knight Frank

Property Manager of the Year – Ringley Chartered Surveyors

Residential Investment Agency of the Year – Knight Frank

Asset Manager of the Year – Grainger

PRS Deal of the Year – Mace

Deal of the Year – Deloitte Real Estate

Large Developer of the Year – The Berkeley Group

Small Developer of the Year – Mount Anvil

Development of the Year – Royal Wharf – Ballymore and Oxley

Newcomer of the Year – Resonance

Landlord of the Year (Privately Owned) – Get Living London

Landlord of the Year (Registered Social) – A2Dominion Group

Residential Financier of the Year – The Royal Bank of Scotland

Student Accommodation Operator of the Year – Unite Students

Residential Personality of the Year – Sean Mulryan - Ballymore Group

Residential Land are big supporters of Property Week and what the RESI conference’s and Award shows have done for the residential market. We are already looking forward to this year’s RESI conference at the Celtic Manor on 7th - 9th September 2015.

See more pictures and video HERE


Residential Land CEO Bruce Ritchie with Fiona Freeman (left) and Susan Geddes


Residential Land guests


Residential Land Sales Consultants Sibel Osman (left) and Vanessa Vaara