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TODAY'S OTHER NEWS

Buy-to-let “chain reaction” drives prices to record high

Asking prices have hit a record high due to the rush of buy-to-let investors looking to beat the stamp duty surcharge.

The 1 April stamp duty deadline helped to ignite an onward chain reaction, boosting the bottom of the market and having a knock-on effect higher up.

The latest monthly report from Rightmove shows the average price of property coming to market rose 1.3%, or £3,843, to a record high of £307,033.

While buy-to-let momentum at the bottom of the market has now dropped away, demand remains high with record visits to Rightmove.

Miles Shipside, Rightmove director and housing market analyst, said: “The onset of spring is traditionally when the housing market swings into full-on action, but the housing market actually received a much earlier kick-start at the end of November. 

“Chains need a buyer at the bottom to enable everyone to move, and that was boosted by investors looking to avoid the 3% levy introduced on 1 April.”

Shipside said that many of those who sold during the buy-to-let rush were first-time sellers looking to trade up.

“They used the heightened demand from investors competing fiercely with first-time buyers to springboard themselves onto the next rung of the housing ladder.

“After several years of being held back from moving by post-credit-crunch price doldrums, they have now benefitted from a heady combination of price growth, historically cheap interest rates, and confidence of a quick sale with purchasers working to a tight deadline.

'Trader-uppers have now been unleashed and this has spread demand upwards and helped to form longer chains.”

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