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TODAY'S OTHER NEWS

Investors get set for buy-to-let “scramble”

Property market experts have warned that the forthcoming buy-to-let surcharge on stamp duty will trigger a shortlived scramble for property in the run up to April.

Chancellor George Osborne announced the surcharge in his Autumn Statement and Spending Review on Wednesday.

It will increase the stamp duty bill on a £300,000 property from £5,000 to £14,000.

Last week Ray Boulger at brokers John Charcol warned of a buy-to-let boom and bust and warned investors against getting swept away by the rush to buy.

Now Brian Murphy, head of lending at the Mortgage Advice Bureau, has also voiced his concerns: “Landlords and second-homeowners will be rushing to purchase before stamp duty changes come into effect.

“This could temporarily inflate prices in some parts of the market.”

Adrian Gill, director of Reeds Rains and Your Move estate agents, predicted a race to beat the new surcharge.

“There will be a scramble for second home purchases before the April deadline, which will only ramp up the existing competition between landlords and first-time buyers in the housing market.”

Gill warned that the Chancellor may unwittingly push prices in the short term, and pricing out many prospective homeowners.  

“Any hit against the supply of rental homes will hurt tenants’ finances, and delay their realisations of homeownership.”

Jonathan Adams, director of prime central London estate agency Napier Watt, said: “We fully expect property price growth to accelerate over the next few months as landlords and second homeowners bring forward their decision to buy.

“Unless there is a significant increase in stock coming to market to absorb this increased demand, which at the moment looks unlikely, prices will continue their upward trajectory.”

Mortgages for Business has updated its residential property stamp duty calculator to help landlords compare rates of duty both before and after 1 April 2016.

Sales director Steve Olejnik said: “This is particularly important for those who are considering transferring their properties from individual ownership to a corporate vehicle.”

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