The price of small properties across many parts of the country has dropped largely because landlord purchases are down, offering fresh hope for first-time buyers looking to get a foot on the property ladder, new figures show.
The number of properties bought by landlords has declined sharply following a tax and regulatory clampdown, resulting in a 0.1% drop in asking prices for properties with two-bedrooms or fewer last month, the latest figures from Rightmove reveal.
Smaller properties are typically popular with landlords, but the recent fall in buy-to-let investor activity, in response to tax changes and tighter lending rules, offers first-time buyers “an autumn opportunity to negotiate a favourable deal”, according to the property website.
Miles Shipside, director of Rightmove, said: “Landlords are clearly buying far fewer properties and that leaves a gap in the market for first-time buyers.
“While landlords were hit with a 3% stamp duty surcharge on property purchases back in April 2016, in contrast most first-time buyers were effectively awarded stamp duty-free status in November 2017.”
First-time buyers are now paying an average of £190,000 for their home, compared with £307,000 across the whole market, Rightmove said.
Meanwhile, separate data from Hamptons International shows that the total value of new buy-to-let acquisitions during the first half of 2018 dropped by 30% compared with the same period in 2015, as regulatory and tax changes continue to have an adverse impact on the buy-to-let market.