Landlords buy cheaper properties

New report shows buy to let investors have switched to cheaper properties

The Estate agents Countrywide have found Landlords paid 8.3% less in April than March with a price drop from £194,000 to £178,000 as buy to let investors look for cheaper properties to reduce the new extra property stamp duty tax. London dropped 16.4% from £436,000 to £365,000.

However cheaper areas of the country are seeing an increase in prices such as north east of England and Yorkshire. Average rents are also up 2% over the last 12 months.

“April’s fall off in investor activity seems to be the consequence of landlords bringing forward purchases to beat the stamp duty deadline. Rather than being dissuaded by the new three per cent charge it seems that landlords are already adjusting their behaviour. In response to the extra purchasing costs many are choosing to buy cheaper homes that offer a higher yield and of course a lower stamp duty bill” says Johnny Morris, research director at Countrywide.

“There’s early signs that first time buyer numbers are increasing in as investor activity has declined. But it’s too early to tell whether this is simply the after effects of the stamp duty rush or the start of a longer term trend” he says.

Written by: Houseladder