The Effects of the Rise in Stamp Duty
In April 2016, changes to the law meant that landlords and property owners would see a three percent rise in stamp duty on second properties. We've surveyed 1,000 adults across the UK to find out how they we will be affected.
Since 1st April 2016, landlords and buy-to-let property investors purchasing additional properties will pay an extra three percent in stamp duty. This was designed to slow down and settle the housing market.
As expected, there were a large number of buy-to-let mortgage loans in March as people tried to avoid paying the additional fees, however, what effect will the new legislation have now on anyone looking to buy a second property?
To find out if this may have had an effect, we asked 1,000 UK adults:
‘Would a 3% increase in stamp duty put you off buying a second property to let?’
59.6% of respondents said ‘yes’, leaving 40.4% confident that the increase in stamp duty would not affect them. When we break down the results a little further by gender, we see more women (61.9%) than men believed the rise in stamp duty would put them off.
The chart below illustrates the gender comparison of respondents answering our survey:
It’s clear from the results that a significant number of potential landlords would be put off buying a second property – an affect the new legislation had wanted to achieve.
If someone did go ahead with a new buy-to-let mortgage loan, how might they absorb the additional three percent fee in stamp duty? To find out, we carried out another survey of 1,000 adults in the UK and asked:
‘If buying to let, how would the 3% rise in stamp duty affect you?’
The majority of respondents (55%) said that it would not affect them, however, 19.8% would recoup the costs e.g. raise rents, and 8.8% would have to take out a loan.
This is a marketing article by Towergate Insurance.