19 Jul

Surge seen in buy-to-let supply

Surge seen in buy-to-let supply

There was an increase in rental supply ahead of the April stamp duty changes, according to new figures.

Data from Rightmove shows an eight per cent increase in the number of properties advertised to rent during the second quarter of the year, compared to the same period in 2015.

The biggest increase was seen in London with a 22 per cent rise, which was accompanied by a small decrease in the average asking rental to below £2,000.

There was also a growth in the number of prospective renters - a two per cent increase compared to 2015.

"The big spike in March transactions resulting from a large number of investors beating the more punitive stamp duty tax deadline has created a rental supply boost which is good news for prospective tenants actively looking for a new place to live," said Rightmove’s head of lettings Sam Mitchell.

"Now that the stamp duty changes have come in this boost may be short-lived, as landlords consider whether or not to make further purchases. Our own research among landlords shows that just under a third of them are concerned that the stamp duty changes, plus the forthcoming tax relief changes, will potentially wipe out their profits," he explained.

He added: "Once the tax relief changes start to be phased in from next year new buy to let activity could slow further. However rental demand is still outstripping supply in many areas of the country so we may see a shift by investors to look in areas that offer better yields for long term property investments."ADNFCR-1222-ID-801821989-ADNFCR

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