A survey conducted by the Bank of England has suggested that George Osborne’s Stamp Duty Land Tax (SDLT) is unlikely to quash demand for buy to let investments in the long term.
The Bank said that the Chancellor’s three per cent surcharge on second homes would not solely lead to a “substantial reduction” in purchases long term, despite predictions from the Council of Mortgage Lenders that property sales in the UK are likely to plummet “at a rate of around 10,000 per month” now that the so-called buy to let rush has subsided.
The new Bank of England research, which surveyed more than 100 housing market authorities and officials, confirmed that market activity was expected to be “subdued” in the second quarter of 2016.
However, the survey also found that most property experts had “positive expectations of rental growth and of the continuing attractiveness of buy-to-let relative to alternative investments” for the long term.
The Bank of England expects that “rampant demand” for buy to let investments will ultimately continue, despite ongoing complaints and criticisms that would-be investors are being priced out of the market by Osborne’s SDLT changes.