The rise in stamp duty for buy-to-let investors does not appear to be putting landlords off when it comes to buying properties, with new figures showing the number of transactions has increased.
Statistics from HMRC show 60,000 properties that were subject to the additional property stamp duty charge were sold in the second quarter of the year, up from 58,200 in the first quarter.
Since 1st April 2016, anybody buying a property that is not their primary residence has been required to pay an additional three per cent in stamp duty, adding thousands to the cost of investing in property and leading to fears that the buy-to-let market would suffer and a lack of rental accommodation could frustrate tenants and force rents upwards.
However, with property continuing to deliver exceptional returns, particularly in comparison with a host of other investment options, it seems quite the opposite is true.
Allison Thompson, managing director at property specialist Leaders, says: “Investors appear to have realised that the substantial returns on offer in the property market far outweigh the initial costs, including an increased stamp duty tariff.
“With tenant demand remaining extremely high across the country and rents continuing to rise, conditions are perfect for landlords looking to make the most of their property.
“Most additional stamp duty transactions were completed on properties priced under £250,000, which are popular with investors and are subject to lower initial costs, but still offer a fantastic return. It is clear the buy-to-let market is open for business and still the best choice for ambitious investors.”
It is not only the number of transactions that rose in the second quarter of the year, with HMRC also revealing stamp duty revenue was £2.3 billion during the three months in question, up from £2 billion in the first quarter. The amount raised through additional stamp duty increased from £464 million to £503 million.
For tailored advice on investing in property contact your local Leaders branch.