The UK’s stamp duty holiday came to an end this week, but the housing market continued to soar to unexpected new heights – with the buy to let market in particular seeing a huge amount of success.
As of July 1st, the stamp duty holiday started its phasing out, with reduced rates in place until October 1st. For those looking to purchase a buy to let property, the current rates are as follows:
– 3% for a property between £0-£250,000
– 8% for a property between £250,001-£925,000
– 13% for a property between £925,001-£250,000
– 15% for a property £1.5m+
The government’s introduction of the stamp duty holiday back in July of last year was an inspired move when looking back, one that stimulated the property market in a time of need and allowed it to prosper whilst countless markets plummeted.
Newly released data from Nationwide has showcased how much of an impact the stamp duty holiday has had on the market over the last 12 months. The annual price growth rate accelerated to 13.4% in June this year, the fastest rate in over 15 years. According to the data, and after taking seasonal factors into account, average house prices across the UK increased by 0.7% month-on-month as the market continued its incredible performance.
According to the report, Northern Ireland was the strongest performing region, experiencing an impressive 14% year-on-year increase. Looking at England specifically, average house prices increased by 9.9%, with Yorkshire & The Humber leading the way as the strongest performing region with a 13% annual increase. This increase was the strongest price growth the region has experienced since 2005.
Robert Gardner, Nationwide’s Chief Economist, had this to say on the report; ‘Annual house price growth accelerated to 13.4% in June, the highest outturn since November 2004. While the strength is partly due to base effects, with June last year unusually weak due to the first lockdown, the market continues to show significant momentum. Indeed, June saw the third consecutive month-on-month rise (0.7%), after taking account of seasonal effects. Prices in June were almost 5% higher than in March.
‘Regional data for the three months to June indicates that all parts of the UK saw an acceleration in annual house price growth. Northern Ireland and Wales saw the largest gains, at 14% and 13.4% respectively in Q2. By contrast, Scotland saw the weakest rate of annual growth, at 7.1% closely followed by London at 7.3%.’
House prices weren’t the only thing on the rise in the last few months, as new data from ARLA Propertymark revealed that the number of new prospective tenants hit an all-time high in the month of May. When breaking this down on a regional basis, The West Midlands had the highest tenant demand, whilst Northern Ireland had the lowest.
This increase in tenant demand coincided with rents rising to record high levels. Research from HomeLet revealed that the average rent in the UK is now £997, an impressive 4% increase on the year prior. When taking the capital out of the picture, the figure rises to 6.4%, further cementing the investment potential that rental property offers.
HomeLet chief executive, Andy Halstead, stated; ‘Rental properties continue to play a crucial role in meeting the demands of people up and down the country, and the flexibility and responsiveness shown by the private rental sector will be vital in the coming months as the country opens up again.’
Despite the end of the stamp duty holiday, the property market continues to flourish and offers an extremely prosperous investment opportunity for those looking for their next buy-to-let property. The mix of increasing house prices, rents and tenant demand couldn’t get much better for property investors, so now’s the time to take the plunge and either start or increase your portfolio!
If you’re interested in investing in buy to let property, why not take a look at some of The Professor’s top properties here?
