Landlords got yet another kicking from the Chancellor in the Autumn Statement. Does this spell the end of the buy-to-let boom?
Buy-to-let landlords have been given yet another kicking, with the Chancellor announcing property investors will soon face a higher Stamp Duty charge than those purchasing a home to live in themselves.
George Osborne announced in the Autumn Statement that those purchasing a holiday home or a buy-to-let investment will have to hand over 3% more in Stamp Duty from next April.
According to specialist mortgage lender Kensington, if this surcharge had been in place for the first three-quarters of 2015 it would have added an incredible £4,565 average Stamp Duty onto every buy-to-let property purchase.
What will you pay?
Stamp Duty is calculated at tiered rates, depending on the portion of the purchase price which falls into a particular band.
Below is a table showing current rates, and how much it will cost landlords from next April.
|
Purchase price bands |
Current Stamp Duty rate |
Landlord Stamp Duty rate from April 2016 |
|
Up to £125,000 |
0% |
3% |
|
£125,001-£250,000 |
2% |
5% |
|
£250,001-£925,000 |
5% |
8% |
|
£925,001-£1,500,000 |
10% |
13% |
|
£1,500,001+ |
12% |
15% |
On top of that the Chancellor announced that Capital Gains Tax on property sales, which is only chargeable when the property sold is not your main residence, will have to paid within 30 days. And in the Summer Budget Osborne confirmed the tax reliefs available to landlords would be stripped back.
David Lawrenson of lettingfocus.com said: “Whichever way you look at it, this seems like a huge attack on small-scale landlords.”
Yet rents continue to rise, while buy-to-let mortgage rates have never been cheaper.
What do you think? Is this the death of buy-to-let?
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