Will 2016 see the end of BTL? Don't count on it......

Will 2016 see the end of BTL? Don't count on it......

The property investment landscape is subject to constant change and, as a result of new legislation, some of the biggest changes ever to hit buy-to-let and auction property investors are just around the corner.

In April, the Chancellor’s stamp duty on second properties is due to kick in. But are property investors prepared? What does the news spell for buy-to-let and auction buyers? And will we see the number of bidders dropping in 2016? These are the questions that have been preoccupying industry commentators.

A recent report by the Bank of England  confirmed that buy-to-let lending is approaching its pre-crisis peak, whilst recently-released figures state that house prices have increased a whopping 10% in the year to January .

With demand outstripping supply, investors are keen to seize the opportunities, although many commentators are expecting the 3 per cent increase in stamp duty payable on a second property after April 2016 to be a deterrent.

However, following the summer and autumn statements last year, here at Together we saw a 28% increase in buy-to-let lending cases in Q4 of 2015, compared with the previous year. Auction houses have also reported significant growth in 2015 , with the anticipation that this will continue in the months ahead.

This suggests that George Osborne’s changes have, in fact, spurred property investors to enter the market before the April stamp duty hike and looks likely to continue, at least for the first quarter.


While it is possible that April might be followed by a cooling off period and a potential dip in auction bidding, we don’t envisage the measure deterring investors for long. Given the pace at which prices are currently rising, any upfront cost could be mitigated very quickly – particularly in London and the South East.

Obviously property investors and landlords will need to adjust their models to take the new stamp duty into account, but it is unlikely to stop seasoned auction house bidders from buying altogether.   

Beyond this, investors will start exploring other options. For example, we could see an increase in bidding for commercial or semi-commercial properties, as the stamp duty increase is specific only to purchases of residential property. This tactic could save savvy investors thousands upfront.

One thing is sure – Together is ready to help landlords and investors to secure properties that match their investment aspirations at auction, and 2016 looks set to be an exciting year.

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Spencer Fortag
Spencer Fortag 30 Nov 2016

I am glad that someone listened to me!

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Tony Gimple
Tony Gimple 27 Nov 2016

It's not just the lack of estate agency advice that's costing landlords money; most are getting seriously bad advice from their accountants resulting in tax bills far higher than they need to be. Likewise,...

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Sally Walmsley
Sally Walmsley 18 Nov 2016

The RLA stands by its sell-off statistics. While we welcome the feedback from Mr Jagota and are delighted to hear how well things are going for landlords in the north east, we would like to make it clear...

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Sheryl87
Sheryl87 18 Nov 2016

The high employment levels and the vibrant economy has led to ever-increasing demand for rental properties, especially from professionals relocations from other cities. This has led to more experts teaming...

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Sheryl87
Sheryl87 18 Nov 2016

Renting out your house can be risky business. It's good to think about residential landlords insurance. Standard cover includes buildings cover and cover for loss of rent following damage to a property...

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AmberMorris
AmberMorris 09 Nov 2016

Fear of ghosts, really?? Ok, I get the fear of bats in the attic and mice and rats running under your nose - those are easy to deal with pest issues which are really unpleasant and can turn you off. But...

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AmberMorris
AmberMorris 08 Nov 2016

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warren
warren 08 Nov 2016

There you go buddy :)

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Agent_PeeBee
Agent_PeeBee 07 Nov 2016

Any reason why my comment to this 'article' has not been published?

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Sean Lees
Sean Lees 04 Nov 2016

I don't think anyone can say dogs or cats are better or worse; depends on the animal, its age, how long it's left inside, etc. How bad the mess is depends somewhat on whether you are renting furniture...

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daniel black
daniel black 25 Oct 2016

I've been keeping a close eye on what the effect of Brexit has been on the rental market and it's a very mixed bag. Whilst the majority of the news focuses on London's market. I think this time next year...

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Northerner
Northerner 20 Oct 2016

Any views from outside the M25? No wonder politicians can't get the housing big picture when everyone seems to think that London is the yard stick, when it absolutely is not.

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