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TODAY'S OTHER NEWS

Landlords target cheaper homes

Landlords have started to change their purchasing habits in response to the new 3% stamp duty charge for investors introduced last month, according to the latest lettings index.

Landlords are looking for cheaper homes to acquire, in an effort to offset the 3% increase in purchasing costs, with the average price paid by investors in April falling by 8.3% month-on-month, from £194,000 to 178,000.

London saw the biggest change in behaviour with landlords purchasing homes costing an average of £365,000 in April, down 16.4% from £436,000 in March.

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But generally lower priced markets saw a less marked response from landlords with average prices paid by investors rising month-on-month in the North East and Yorkshire. 

The Lettings Index from Countrywide also reveals that average rents increased by 2% over the last year, leaving the average monthly UK rent at £932. Rental growth is now half the rate it was in 2015 and the report suggests that affordability constraints and the increase in the number of homes coming onto the rental market continues to slow rental growth.

Johnny Morris, research director at Countrywide, said: “April’s fall off in investor activity seems to be the consequence of landlords bringing forward purchases to beat the stamp duty deadline. Rather than being dissuaded by the new 3% charge it seems that landlords are already adjusting their behaviour.  In response to the extra purchasing costs many are choosing to buy cheaper homes that offer a higher yield and of course a lower stamp duty bill.

“There are early signs that first-time buyer numbers are increasing in as investor activity has declined. But it’s too early to tell whether this is simply the after effects of the stamp duty rush or the start of a longer term trend.”

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    Landlords are increasingly buying cheaper homes. And this leads to more available for first time buyers.

    ???

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