Buy-to-let stamp duty changes 'will take a little heat out of investor market'

The housing market is set for a cool-down over the next few months following a rush to snap up buy-to-let properties, according to predictions from the Royal Institution of Chartered Surveyors (Rics).

From April 1, buy-to-let investors will pay three percentage points above current stamp duty rates when purchasing a property.

Rics said surveyors are expecting to see a drop-off in sales of investment properties as the deadline for the hike approaches and investors no longer have time to complete sales before April 1.

Its chief economist, Simon Rubinsohn, said: "It is inevitable that over the coming months, April's stamp duty changes will take a little of the heat out of the investor market."

He said despite the expected slow-down in the coming months, long-term expectations for house prices remained "strong" - with property values generally expected to increase by 25% over the next five years.

The survey showed house prices continued to increase in February.

East Anglia continued to show the sharpest price increases, with 91% of surveyors there reporting rising prices.

Rics said London and the North East were the only two UK regions where prices failed to rise, holding broadly stable over the month.

The report said: "Anecdotal evidence suggests tax changes, concerns over Brexit and global economic uncertainty are all taking their toll on buyer sentiment in the capital."

In London, surveyors' house price expectations for the coming three months turned negative for the first time in a year.

But in the longer term, surveyors still expect property values in London to increase by around 4.5% a year over the next five years - which is broadly in line with house price expectations for the UK generally.

Across the UK, the supply of new homes coming on the market had started to rise "modestly", the report said.

The South West of England continued to see the sharpest growth in sales volumes, it added.