Rents and landlords’ returns both rise – but the big challenge is Stamp Duty

A recent report said rents are accelerating this year, with rents up 3.6% in January on an annual basis. Further, taking into account both rental income and capital growth, the average landlord in England Wales saw total gross returns of 12% in the 12 months to January.

That equates to an average of £21,988. The average capital gain contributed £13,594 while rental income made up £8,394.

Apparently stamp duty premiums on new buy-to-let purchases are the big challenge.

The 1st April deadline and the extra purchase costs are perceived as a potential threat.

Landlords are long-term investors and generally take good advice before making a new purchase so any disruption to investment in supply is likely to be short term.

Separately, the Council of Mortgage Lenders said the buy-to-let sector is going through an uncertain period as it is unclear how changes to the tax treatment of the sector will affect it.

It said that current demand for homes was being led by buy-to-let landlords. It expects to see a “modest fall” in total activity in the second and third quarters of this year.

The CML also reported an estimate of £17.9bn mortgage lending in January, 21% up on last year and the highest lending total for a January since 2008.

Please contact us on 020 8643 7777 or email at info@christiesworld.com

www.christiesworld.com