According to new figures published in the latest report from Connells Survey and Valuation, activity in the buy-to-let market sharply increased in August, suggesting that Landlords are feeling more confident again, following the double-whammy of April’s tax changes and post-Brexit uncertainty.
The 12.7% increase in buy-to-let activity, the report says, indicates that the Government’s policy changes concerning the buy-to-let sector announced in the 2015 budget – the stamp duty hike, the restriction of tax relief on mortgage finance costs to basic rate tax only, and the removal of 10% wear and tear allowance – have now been absorbed.
Although investors may still not be enthusiastic about the new legislation, the sector remains lucrative enough and stable enough to be worth their investment.
Concerns over the impact of Brexit have also calmed, given that the sky did not fall and World War 3 did not break out, as some erroneously predicted. The flurry of activity in the buy-to-let market is also reflected in the wider economy. The report points out that the UK services sector saw a record rise in August, while first time buyer activity saw the strongest overall increase in valuations, with an annual increase of 19.6%.
The Bank of England’s decision to cut interest rates has also resulted in a surge of activity in the remortgaging sector, with remortgaging valuations growing 4.2% from the previous month.