Estate agents expect the buy-to-let stamp duty reforms to trigger a further increase in sales to first-time buyers due to less competition for properties.
According to the National Association of Estate Agents March housing market report, 39% of estate agents expect the buy-to-let stamp duty reforms to increase availability for first-time buyers as investors back away.
More than a third (36%) of estate agents believe sales to first-time buyers will pick up further, due to less competition for properties.
Three in 10 (28%) of the total sales made in March were to first-time buyers, up four percentage points from February.
The 3% stamp duty increase, which came into effect on 1 April, is part of the government’s attempt to curb the buy-to-let market and free up property for first-time buyers. The basic rate of tax relief landlords can claim on properties is also set to fall to 20% from April 2017.
Mark Hayward, managing director, National Association of Estate Agents, said: “The last few months first time buyers have had to compete with landlords for the same properties and those landlords have really pushed hard to complete ahead of the rise in stamp duty. Now, in theory things should get easier for first-time buyers – as we have seen with a slight increase in sales this month – as those seeking to buy to let will tail off.
“However in reality, it’s unlikely in the long term that first-time buyers will notice a huge difference, as prices remain high and housing is in short supply. Government needs to significantly increase the number of homes that are being built in this country to really make a difference to those that are struggling to get on the housing ladder.”
Last month, the supply of houses available to buyers soared by more than half (54%) – from 35 properties available to buy per branch in February, to 54 in March. Meanwhile, demand fell last month, with agent reporting an average 417 house hunters registered per member branch – down from 463 in February when demand for housing was at the highest level in 12 years.
Estate agents also reported a fall in the number of properties selling for more than asking price. Only 7% of agents saw this happen in March, compared to 11% in February.
What Mortgage has teamed up with London & Country to offer you expert advice on the right mortgage deal.
Whether you’re buying a new home, remortgaging to a new deal or buying an investment property, L&C can help – and you’ll pay no fee for their advice. To find out more, click here.
Loading ...