While the media is flooded with reports on the benefits for homebuyers, the Government’s recent Summer Statement also brings good news for landlords and property investors alike. Read on to learn more about some great opportunities to take advantage of.
The Chancellor’s recent announcement saw more good news for landlords and property investors than we have seen for a long time, which is a really positive sign for the coming months. If you’re a landlord or investor, you could stand to make some huge savings on Stamp Duty and energy efficiency home improvements.
Ready... no Stamp Duty... let's go!
Clearly a huge benefit for homebuyers, the announcement of a Stamp Duty (SDLT) holiday also sees savings for landlords and investors. Although any second property purchased will still require payment for the additional 3% Stamp Duty as before, you will not need to pay the standard charge that accompanies it (up to £500k).
So what does that really look like for you? Well, it all depends on the purchase price of the property...
|Purchase Price||Previous SDLT cost||Current SDLT cost||Saving|
As you can see, there are some great savings to be made, and savvy investors will be able to use the money towards refurbishment costs, stretching their budget further or to achieve a different mortgage banding and thus increase the ongoing yield.
If you would like guidance on where the investment hotspots are, please contact your local branch who will advise on yields and demand levels.
Green Homes Grant
The introduction of a grant to help landlords make their properties more energy efficient will be well-received.
Following the most recent change to EPC legislation that stated all rental properties needed an EPC rating of 'E' or better, it will give landlords an opportunity to ensure their properties are graded far higher and so further protect themselves against changes which could be seen in future legislation.
The grant offers to pay £2 for every £1 spent by the landlord up to a maximum contribution of £5,000.
The aim of the Green Home Grant is to upgrade over 600,000 homes across the UK, saving households hundreds of pounds each year on their energy bills. More details will be released in coming weeks and the scheme will be open for applications in September.
What Leaders says…
Commenting on the Summer Statement and how it will impact landlords and property investors, Michael Cook, National Lettings Managing Director at Leaders, says: “It’s good news and will keep the market moving in a positive direction. There hasn’t been a huge amount on the table for buy-to-let landlords in recent years, but the Chancellor's announcement represents a unique window of opportunity for investors to add to their portfolio or invest in it to provide a more economical home for their tenant, whilst saving money.”
We’ve seen that residential property has shown itself to be a highly resilient asset class over the COVID-19 pandemic and has performed exceptionally well against both other property and investment classes, with high levels of rent receipts being maintained. “This combined with potential SDLT and ‘Green grants’ savings should give a lot of investors the confidence to purchase more property over the next nine months, providing further much needed-homes in the private rental sector”, he adds.