| The Government has given landlords a hard time in recent years. There have been stamp duty hikes, the tapering of the tax relief on mortgage payments and a ban on tenant fees. So now property investors have finally caught a break, they seem to have gone a bit berserk.
Estate agents have reported a huge surge in inquiries from people wanting to purchase buy-to-let properties since Chancellor Rishi Sunak announced a temporary stamp duty holiday last week.
The tax cut will shave costs for buyers of rental properties by up to 15,000. They will pay stamp duty at a rate of just 3pc on the first 500,000 of a property's price. Previously, second home buyers would pay 3pc on the first 125,000, then 5pc on value up to 250,000 and 8pc on the price up to 925,000, with the rates continuing to increase incrementally.
Agents have seen increases in demand of up to 40pc and said the most sought-after homes were those worth 400,000 to 500,000 in commuter belt areas such as Milton Keynes. An investor buying a home worth half a million pounds will pay half the tax they would have done a month ago: 15,000 rather than 30,000.
This means buyers in the priciest expensive parts of the country – primarily London and the South East – will benefit most. Here we map the areas where investors can make the biggest savings, from the Isles of Scilly to the London borough of Newham. One estate agent in Kent, Spencer Fortag, of Dockside Property Services, said the area's buy-to-let market had “gone bonkers”.
Not everyone will be celebrating the news. The tax giveaway means that first-time buyers, who already paid less or no stamp duty on homes worth up to 500,000, have lost their advantage as the lower rates are now applied to all buyers. Saving money on their tax bill will allow property investors and overseas buyers to make larger offers so they can outbid younger home-seekers.
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