New Property Tax Drives Business Growth for Bathroom Specialist
Wednesday, November 4th, 2015
on behalf of Project Work and Other Clients
Boscolo sees business boom as LBTT launch prompts wealthy home owners to invest in existing homes instead of moving
A LUXURY bathroom entrepreneur says wealthy home owners are fuelling growth in his business to avoid being hit by the Scottish Government’s new property tax.
Ronnie Scott believes the replacement for stamp duty on £1 million plus homes has slowed property sales, as discerning home owners in Edinburgh concentrate on upgrading their existing homes instead.
The businessman recently invested £75,000 to open a new Boscolo Bathrooms showroom in Stockbridge, building on the success of his existing branch in Causewayside on the capital’s south side.
Mr Scott added: “We are seeing very clearly that people with homes worth more than £1m – and are there are many in Edinburgh – are choosing not to sell because of these tax implications.
“Instead many are choosing to invest in their existing home rather than
moving and that generally involves a range improvements. That is fortunate for us because an upgraded bathroom is usually top of the list.”
Earlier this year the Scottish Government introduced a new Land and Buildings Transaction Tax to replace traditional stamp duty. It is a sliding scale with the highest charges of 12% applying to properties worth £750,000 and more.
Mr Scott’s experiences support a recent report by upmarket estate agency, Knight Frank, which says a “two-speed” market is now operating in the Scottish capital. It reported that since the introduction of the LBTT, price growth has been driven mainly by the sub-£500,000 property market.
The estate agency found that while prices for properties under the £500,000 bracket rose by 1.1% in the third quarter of 2015, the sales values of properties over £500,000 increased by just 0.2% in the same period.
Meanwhile Knight Frank also found that purchase costs had almost doubled for some prime properties, further fuelling concerns that high end home owners will avoid selling where possible.
Mr Scott added: “It’s fair to say I wasn’t remotely surprised by the Knight Frank report. We are repeatedly hearing property owners telling us that the LBTT is putting them off selling.”
Mr Scott also believes that other high end home improvements experts, including interior designers, architects, and high-end kitchen suppliers will also be benefitting from the boom in makeovers for top end properties.
He added: “For our part, we are seeing the greatest demand for master bedroom en suites. Those are what people want, because it is a personal indulgence as well as being incredibly practical time save for busy professionals.
“Our clients tend to be discerning, high net worth individuals with extremely busy and demanding working lives, so they don’t want to be jostling with teenage kids for bathroom time, particularly in the mornings.”
Another favourite is for a cloakroom WC and Mr Scott says this is a marked sign of the economic recovery, as people become more comfortable with conspicuous displays of wealth.
He added: “These bathrooms are very much an unashamed status symbol. They are really there to be used by visiting friends and family and to let people know that the home owner has both impeccable taste and the means to express it.
“This is particularly welcome to us and many businesses like ours, because during the recessions even those who could afford such home improvements were wary of doing anything that may have been viewed as ‘showy’ during the recession.
“There has been a complete turnaround which says to me that people are now confident that the recession is very much behind us.”
Boscolo supplies and fits high-quality bathrooms from the most respected manufacturers, including Villeroy & Boch, Dornbracht, Keuco and Mastella. Home owners enjoy a fully rounded service, including a detailed property survey and a 3D design and review process. Boscolo’s 10-strong team then take care of the meticulous fit out and finishing.
Each customer is provided with a detailed account of everything that will be involved in their bathroom project, with every item costed and a clear timeline laid out and clients never have to deal with a supplier or separate fitter.
The experienced team supply and fit up to 75 bathrooms per year earning the vast majority of referrals by word of mouth from satisfied customers.
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