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Below the water line - Stamp Duty hits housing

 

By Richard Walford

The first evidence of the impact of last year's Stamp Duty reforms hitting the rental market. Stamp Duty continues to be an easy tax for the Revenue to collect but it will reduce rental stock. It also makes buying and selling property much more illiquid. That doesn't make well for supporting a modern 21st century flexible and mobile workforce.

Government action in the Autumn Statement to relieve some of the market pressures created by stamp duty, combined with much needed reform of business rates to help retailers would be very welcome.

Rents climb 2.2% after stamp duty hike squeezes London property supply Countrywide says fewer landlords have been buying after a stamp duty rise of 3% in April 2016 deterred buy-to-let investors. The annual rate of rental growth in Britain doubled from 1.1% to 2.2% between June and July, driven by a turnaround in the London market, according to Countrywide. Rents in the capital ended the month 2.1% up on last year, as the number of properties available to let fell sharply. Countrywide said the rise was down to a steady drop in supply, with fewer landlords buying properties after stamp duty rates increased by 3% for second-home buyers, such as buy-to-let investors, from 1 April 2016. Rents rose fastest in the South West, East of England and Greater London. Outside these areas, Scotland saw the fastest rental growth, at 3%.
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