Stamp Duty Holiday – Can Landlords Benefit?

There has been a lot of focus on the impact of the stamp duty holiday on buyers, but will it also affect landlords?

There has been a lot of focus on the impact of the stamp duty holiday on buyers, but will it also affect landlords?

At Ariston Property, we are pleased to say landlords can benefit from the stamp duty holiday. As letting industry specialists in North London, we are here to assist you, and provide you with guidance on this matter.

Landlords can benefit from the stamp duty holiday

Steve Olejnik is the Managing Director of Mortgages for Business and he said; “Clearly, landlords need to take advantage of the stamp duty holiday before the window closes in March next year. Property investors are in a better position to qualify for a mortgage now that reduced stamp tax allows them to wield a larger deposit. Furthermore, if the measures Rishi Sunak has put in place underpin property values, the cut will help those looking to remortgage as well.”

Steve continued by saying; “Less obviously, landlords may not appreciate they need to act while they are well-placed to move in a way that owner-occupiers are not. We know property investors have been remortgaging with a view to picking up some bargains. Owner-occupiers have not been doing the same. Landlords have been preparing since the start of the lockdown, remortgaging to enlarge potential war chests with an eye on bagging bargains in the future. First Time Buyers don’t have that flexibility and owner-occupiers haven’t been remortgaging in the same way.”

We know being a North London landlord is challenging, but we are here to assist you as best we can. If you are looking for information or guidance about the role, get in touch, and we will be more than happy to assist you.

Steve continued by saying; “That means landlords are currently very well-placed to seize the day. But that advantage won’t last forever. That’s why smart investors will start expanding their portfolios immediately, rather than waiting and then scrambling to try to do deals at the last minute.”

Landlords need to consider their next move

Mortgages for Business has carried out an analysis based on data from April and May this year regarding the reasons why investors were taking out buy-to-let mortgages.

Analysis undertaken by Mortgage for Business, on data from April and May this year indicate:

• 30% of property investors who took out BTL mortgages at this time did so to expand their portfolio and cash reserves. This was done to minimise their risk.

• 46% of landlords had increased the size of their loans. The long-term average for this action is 38%, so more landlords were active in safeguarding their finances at this time.

Steve Olejnik also said: “This is all about expectations. At the moment, sellers are grateful for a sale and there are plenty of potential sellers who would put their property on the market if they thought they could get a deal done. Currently, sellers aren’t trying to grab the money that buyers had tucked away to pay for stamp duty – cash that was earmarked for the taxman. But the closer we get to March 2021; the more sellers are going to start making bids to grab the money that buyers had originally allocated to the government.”

For property buyers who are in a position to act quickly, which includes landlords who have sufficient funds, will find as we move closer to the stamp duty deadline, more opportunities to buy property will become available.

Steve Olejnik continued: “This is all about expectations. At the moment, sellers are grateful for a sale and there are plenty of potential sellers who would put their property on the market if they thought they could get a deal done. Currently, sellers aren’t trying to grab the money that buyers had tucked away to pay for stamp duty – cash that was earmarked for the taxman. But the closer we get to March 2021; the more sellers are going to start making bids to grab the money that buyers had originally allocated to the government.”

We know these are challenging times, but if you have any questions about the local property market, please feel free to contact us. At Ariston Property, we aim to support the local community as best we can, and we look forward to assisting you in any way.