Figures show stamp duty surcharge sparked property buying frenzy
Friday 22 April 2016
Record-high house prices were caused by the surge in buy-to-let landlords looking to beat the stamp duty hike, according to property website Rightmove.
Average prices rose by 1.3 per cent last month to an average of £307,033, and it is thought that those looking to buy second homes were the cause.
Although spring is traditionally a time for house-sale surges, the 3 per cent stamp duty rise imposed by Chancellor George Osborne at the start of April sparked the interest.
Rightmove director and housing market analyst, Miles Shipside explained: "The onset of spring is traditionally when the housing market swings into full-on action, but the housing market actually received a much earlier kick-start at the end of November.
"The rush from investors to buy before April has helped to ignite an onward chain reaction.
"While some felt there would be a stampede of existing landlords selling to other landlords these figures indicate that many of those who sold during the buy-to-let rush were actually first-time sellers looking to trade up.
"They used the heightened demand from investors competing fiercely with first-time buyers to springboard themselves on to the next rung of the housing ladder."
The momentum has obviously slowed since last month, Rightmove says demand is still high and the company is still receiving huge hits on its website.
Former first-time buyers contributed to the property buying frenzy
It was thought that many of those selling their homes to landlords were former first-time buyers looking to move up the property ladder.
Indeed, the price of smaller homes with two bedrooms or less - usually bought by first-time buyers - was down by 1.4 per cent.
Miles Shipside added: "First-time buyers could fill some of the gap but sellers of properties with two bedrooms or fewer need to realise that with less overall demand they need to price cheaper to match first-time buyers and highly taxed investors."
We want to add value to landlords with interesting news and views! Our Hub includes information and opinions on the housing market from a variety of expert sources – please just be aware it doesn’t always reflect Simple’s opinion, or the products and services we provide.