Landlords join home-buyer rush to beat stamp duty holiday deadline

Around one in six (15%) house sales agreed in November went to landlords – the highest proportion since December 2016, according to an index.

More than half (51%) of these purchases were made in cash, according to property services company Hamptons, which compiled the report using data from letting agent the Countrywide Group.

The average landlord who fails to complete their purchase by the stamp duty holiday deadline on March 31 2021 will see their stamp duty bill rise from £5,400 to £6,500, Hamptons estimates.

It said regionally the rush has been concentrated in the Midlands and northern England.

More than a fifth (22%) of homes sold in the West Midlands in November were bought by an investor, followed by 18% in both the North East and North West.

At local authority level, Blackpool claimed the top spot, with 70% of sales agreed in November going to an investor, Hamptons said.

Stamp duty applies in England and Northern Ireland but similar property tax holidays are in place in Scotland and Wales. Hampton’s index covers Britain.

Aneisha Beveridge, head of research at Hamptons, said: “Just like in the months leading up to the introduction of the 3% second home surcharge back in 2016, landlords have rushed to take advantage of reduced stamp duty bills.

“But the difference between today and 2016 is that the stamp duty cliff edge is around five times smaller, meaning the financial impact of missing the deadline is reduced.

“With over half of investor purchases made in cash during November, those taking advantage of the holiday are disproportionately larger investors expanding portfolios rather than new investors starting out.

“And with landlords also making up a rising proportion of sellers, in many cases larger landlords are buying homes from smaller landlords.”

– Here are the proportions of homes bought by investors in November, according to Hamptons:

West Midlands, 22%

North East, 18%

North West, 18%

East Midlands, 17%

Yorkshire and the Humber, 16%

London, 15%

Scotland, 14%

South West, 13%

East of England, 10%

South East, 10%

Wales, 9%