Buy-to-let landlords left reeling from the Chancellor’s Autumn Statement are being advised to act quickly to avoid the 3pc hike in stamp duty that kicks in on 1 April 2016.
Specialist-lender Together has already experienced record levels of lending since George Osborne first waged his war on buy-to-let landlords earlier this year when he reduced the tax relief property investors can claim back on their mortgages.
His latest move means buy-to-let landlords keen to expand their property portfolio must complete their purchases in Q1 of 2016 or face significant tax bills.
The Chancellor is trying to address the “growing crisis of home ownership” in Britain by raising £1b by 2021 to fund the construction of new homes.
Gary Bailey, sales director at Together, said:
“This is a double-whammy for buy-to-let landlords who feel they’re being penalised for being entrepreneurial. The hike in stamp duty, together with the previous announcement that reduced landlords’ ability to offset mortgage interest costs against rental income, will certainly have a major impact on the buy-to-let market.
“That said, this might well fuel other opportunities. For example, we could see a rise in demand for semi-commercial properties, since this latest levy is specifically for residential. Keen property investors will look at the alternatives or will simply build these new costs into their model.
“As a lender, we’re likely to see an increase in demand as a result of this announcement. We’ve already seen a significant upturn in lending since the Summer Budget and this is set to increase in Q1 of 2016 as savvy investors aim to avoid the new 3pc levy that will kick in on 1 April 2016.”