Belfast Telegraph

Landlord mortgages soar ahead of stamp duty hike

By Staff Reporter

Landlords' mortgage borrowing surged by 42% year-on-year in January ahead of a stamp duty increase for the sector.

The Council of Mortgage Lenders said £3.7bn of buy-to-let loans were handed out in January - an increase of 42% compared with the previous year.

While the bulk of buy-to-let borrowing in January was made up of remortgage loans, £1.4bn was for house purchases, showing a 40% jump compared with January 2015.

The stamp duty hike was announced for buy-to-let landlords towards the end of 2015, and there have been signs of landlords rushing to complete purchases before the three percentage point increase kicks in on April 1.

The Royal Institution of Chartered Surveyors (Rics) said that its members were expecting to see a massive drop-off in sales of investment properties as the deadline for the stamp duty hike approaches, and that investors no longer have time to complete sales before it comes into effect.

But in the longer term, Rics still expects UK property values generally to increase by 25% during the next five years amid a lack of supply.

Adrian Anderson, director of mortgage broker Anderson Harris, said: "Remortgaging and buy-to-let lending goes from strength to strength.

"More landlords are taking out mortgages and remortgaging as they try to buy before the stamp duty hike comes in from April. They are also looking at the costs associated with their investments, minimising their mortgage payments as much as possible."

Meanwhile, more available properties and an increasing number of interested buyers will lead to a rise in sales activity during the next three months in Northern Ireland.

That is according to the latest survey from the Rics and Ulster Bank.

New instructions to sell and new buyer enquiries both rose, according to the report published for the month of February.

Belfast Telegraph