You are here: Home - Mortgages - Buy To Let - News -

Buy-to-let stamp duty fee hike will ‘push up rents’

Written by:
New stamp duty reforms for buy-to-let landlords will push up rents and trigger a decline in the supply of available properties, letting agents warn.

A study by the Association of Residential Letting Agents (ARLA) found that six in ten members agree rents will be pushed up once the stamp duty reforms have come in to effect, as increased costs are passed through to tenants.

From 1 April, the government will add three percentage points to the existing Stamp Duty rates for those buying a second property.

That means a homeowner buying a second property for £150,000 before 1 April will pay £500 in Stamp Duty, but £5,000 after the deadline – a tenfold increase.

Over half of letting agents reported an uplift in interest from buyers looking to invest in buy-to-let properties before the stamp duty reforms come into effect. After the deadline, two thirds predict supply will fall as landlords are pushed out of the market.

ARLA managing director, David Cox, said: “Although members are reporting a rush from landlords trying to snap up their buy-to-let investments now, it’s likely that we’ll see the buy-to-let market drop like a stone come April and probably not pick up again until next year. This will most certainly cause rents to increase, with supply dropping, as competition for the limited availability of properties intensifies.”

He added: “We are concerned that the government rhetoric of wanting to help people onto the housing ladder does not tally with their action of continuing to target the rental market with additional costs. Some landlords will simply withdraw from the market whereas others who can take the hit of the extra stamp duty will simply raise rents to cover the extra costs. The dream of home ownership will remain out of reach for many as we move closer towards becoming a nation of forever renters.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Big flu jab price hikes this winter: Where’s cheapest if you can’t get a free vaccine?

Pharmacies, supermarkets and health retailers are starting to offer flu jabs ahead of the winter season, but t...

Is now the time to fix your energy deal?

Fixed energy tariffs all but disappeared during the energy crisis. But now they are back with an increasing nu...

Everything you need to know about the pension triple lock

Retirees are braced to receive another bumper state pension pay rise next year due to the triple lock mechanis...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

The best student bank accounts in 2023: Cash offers, tastecards and 0% overdrafts

A number of banks are luring in new student customers with cold hard cash this year – while others are compe...

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Money Tips of the Week