Peter Mandelson's £750,000 mortgage

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Mandelson's new home in Primrose Hill

Peter Mandelson faces fresh scrutiny after documents revealed that he put down a £1.65 million deposit on his new London home.

The European Trade Commissioner took out a mortgage of just £750,000 on the £2.4 million peach-hued property this summer, according to Land Registry papers.

Questions remain over how the former Cabinet Minister found the funds to make up the rest of the purchase price, plus another £100,000 for stamp duty and legal fees for his new home in fashionable Regent's Park.

Mr Mandelson, who earns £155,000, received half of his mother's £1.45million estate when she died this year - after inheritance tax his share is understood to be £492,000.

He also made a £350,000 profit on his former home in Trafalgar Square and received about £140,000 from the sale of his previous constituency home in Hartlepool.

These windfalls add up to about £982,000. But that still leaves a gap of £768,000 needed to make up the large deposit and pay the stamp duty on the three-bedroom property a short walk from the homes of Kate Moss, Jude Law and Sienna Miller - dubbed the 'Primrose Hill Posse'.

It is believed the shortfall is offset by equity built up from the sale of his previous homes - a sum worth an estimated £400,000.

On top of his success playing the property market, as a single man it is thought Mr Mandelson would have been able to accumulate substantial savings from his high salaries. He has also made money over the years from media work.

The 54-year-old's property dealings have been a subject for speculation since 1998, when it was revealed that the Labour spin doctor had not disclosed a £373,000 loan from ex-Paymaster General Geoffrey Robinson in a mortgage application for a home in Notting Hill, West London. That cost him his Cabinet job as Trade Secretary.

A subsequent investigation discovered Mr Mandelson also failed to disclose three other loans. Mr Mandelson bought his latest and most expensive property on August 30 this year after selling his Trafalgar Square penthouse for £1.2 million.

His mortgage - nearly five times his annual salary - was taken out with the exclusive HSBC Private Bank, the private banking wing of the High Street institution.

Mark Harris, of independent mortgage broker Savills Private Finance, said Mr Mandelson was able to secure a mortgage nearly five times the size of his salary because of his large deposit.

Mr Harris said: "Given the percentage of the loan to the value of the property, the amount Mr Mandelsonearns becomes slightly irrelevant. It might sound like a large loan but it isn't when you have put down £1.65 million."

But Conservative MP Nigel Evans called for Mr Mandelson to come clean on his lucrative dealings for the benefit of thousands struggling to get on the property ladder. He said: "There is a book to be written on how to get good mortgages. It would be a best seller."

Mr Mandelson's spokesman confirmed that he had taken out a 'substantial mortgage' but denied that he had received any other loan. The spokesman added: "He is entitled to have savings, which he did have and he can spend as he sees fit."

 

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