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Monday, April 11, 2016

Pre-April BTL rush increases supply

The 'pre-April rush on property purchases ( resulting from the stamp duty change on second homes) has fuelled supply in the rental market according to Countrywide.

The agents estimate that there was a 76% increase in March 2016 property purchases compared to  March 2015, with half of these made by landlords.

As a result, Countrywide report that rental supply is up by 22% in the first quarter of 2016 compared with Q1 2015.

In the capital, the increase was even larger, with rental supply in London up 40%.

With increased supply easing the supply/demand pressure on rents, rental increases slowed.

UK annual rental growth slowed to 3.4% with average monthly rent now at £931.

Research director at Countrywide, Johnny Morris comments: 

“Quite at odds with the intentions of the policy, the first measurable effect of the introduction of the new Stamp Duty rate has been to increase the number of homes owned by landlords, although this will likely be a temporary effect as we see reduced investor activity in future months.”

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