Buy to let boom continues following SDLT changes
New studies from The Treasury prove that landlords are continuing to purchase buy to let property despite the stamp duty surcharge.
The new rules regarding Stamp Duty Land Tax (SDLT) came into effect from April 2016 and saw those purchasing an additional property pay a 3% surcharge on top of existing stamp duty costs. Over the past 6 months, 1 in 5 properties bought in the UK were second or additional property purchases.
Following the price increase, The Treasury claimed it collected 18% more in stamp duty fees than it did the previous year, demonstrating that landlords and second home purchasers are clearly undeterred by the new rules and have continued to expand their property portfolios.
While there was initially some concern that the costs would put off new buy to let investors and landlords, calculations have proved that the nominal increase in land tax is covered greatly by the level of return and capital growth.
The news follows on from previous government changes which continue to boost the property market. Back in June 2016 when Brexit took effect, the media speculated as to how the housing market would cope with the changes, however studies have demonstrated a strong market and a continued positive outlook, with both investors and residential buyers benefitting from fruitful market conditions.
Managing Director of Sequre Property Investment, Graham Davidson, commented on the rise in numbers for additional property purchases:
“This is welcome news and is in-line with the predictions we made when the additional SDLT surcharge was announced. Savvy landlords understand that the market is buoyant right now, even with the slight addition to stamp duty costs; and while an increase in tax is not usually welcomed, it hasn’t proved damaging either. Providing the investment is right and yields are generous, there is no reason why buy to let will not continue to be an incredibly profitable venture for investors.”
“With as many as a fifth of all UK property purchases registered as second home purchases, there is a large proportion of the population who are clearly still using buy to let as a viable source of income. As we at Sequre have previously predicted, for those investors who purchase their buy to let properties in locations with high tenant demand, strong rental yields and potential for capital growth, returns will be great and there will be a profit to be made.”
At Sequre Property Investment, we tailor our services to suit you. Our unique approach results in you finding the perfect hands-off investment which will help you on your way to financial freedom. Our relationships with developers, house builders and receivers allow us to secure genuine discounts on our deals which you won’t find anywhere else on the market. To find out more, give us a call on 0800 011 2277 today.