A rush to purchase buy-to-let properties before a stamp duty hike arrives in April is hitting the property market, according to a landlord industry body.
The Association of Residential Letting Agents (ARLA) says that a new three per cent stamp duty surcharge for investors – which comes into effect in April – has had an immediate impact, with a quarter of agents reporting an uplift in interest from landlords looking to purchase a buy-to-let property in time to beat an increased tax bill.
The report came as speculation mounts over what effect stamp duty reforms around buy-to-let and second properties announced in the Autumn Statement of 2015 will have on house prices and rents.
According to an ARLA survey, 62 per cent of agents predict the changes will result in higher rents while 65 per cent say it will push landlords out of the market and decrease the supply of homes to rent.
David Cox, Managing Director of ARLA, said: “With supply, demand and the number of agents reporting rent increases all declining in December, this could well be the calm before the buy-to-let storm.”
ARLA agents registered an average of 29 prospective new tenants in December 2015, down from 34 in November. Supply also decreased marginally in December, with an average of 182 properties managed per branch; down from 189 in November.