LONDON, Oct 17 (Reuters) - The number of British homes worth10 million pounds ($12 million) or more sold over the summerfell by an annual 86 percent, hit by property tax hikes and theBrexit vote, according to official data analysed by aresidential fund.
Just five double-digit million pound homes were bought inthe three months to the end of August, according to the LondonCentral Portfolio (LCP), compared to the same period last yearwhen 35 transactions were completed.
A 25.5 million pound property in Belgravia, one of thecapital's most desirable postcodes, was the most expensive homesold but the average selling price of the homes, which were allin London, fell 25 percent to 16.3 million pounds.
Prices in the capital's prime locations have been fallingfor two years according to estate agents Savills after atax known as stamp duty was raised on all homes worth more than937,000 pounds and on second homes and properties bought bylandlords.
"In the wake of increasing residential property taxes,compounded by uncertainty immediately after the EU Referendum, adramatic fall in sales has been seen across the super-primeproperty market," the LCP said.
Property was one of the first sectors to be hit by the June23 public vote, with several commercial funds suspended asinvestors pulled out their cash.
A mixed picture has emerged on how the British housingmarket has weathered the initial shock, with surveys showingdemand has remained robust outside London, where investors andforeign buyers are less active.
But the LCP warned that the collapse in sales of the mostexpensive properties, primarily in the capital, could cost thegovernment 45 million pounds in lost tax revenues.
"As the government faces the daunting task of negotiatingBrexit, together with a potential slowdown in the UK economy, itshould consider its strategy on residential property taxationcarefully to ensure it meets its objectives of increasingrevenues," said LCP's Chief Executive Naomi Heaton.
Finance minister Philip Hammond is due to deliver a budgetstatement on Nov. 23, which could include measures to boost theproperty sector. (Reporting by Costas Pitas; editing by Stephen Addison)