Hi Pete - Interesting to hear other peoples take on this. There is a profit if you ignore inflation of course.
The UK tax manual has more words in it than 'War and Peace' but with plenty more holes I suppose - but put simply we have done exactly the same as MartynKSA's chap - he would have remortgaged too, except that because we haven't sold anything for ages, if George does what he is threatening, people like us will get a CGT tax bill on everything whilst people like MartynSKA's chap will have paid nothing.
This is all hypothetical at the moment of course - but just look at how a small change in the lending, ie the 5% deposit scheme with a government backed mortgage has engineered a new property bubble - funnily enough just 2 years before the election!!!!!
A small change in the CGT rules is not going to make the government any money as history shows - every time they have hiked taxes in the past the takings have dropped - but it is very likely to stop people selling, put people off buying and push already high prices even higher in London because of the lack of supply. It's just a vote collector.
UK already has some of the highest property taxes in the western world -
ps we are renting too!!!