Landlords have joined other buyers in rushing to complete their purchases in the run-up to the end of the stamp duty holiday, according to Hamptons. In November, landlords made up 15% of buyers in Great Britain, which was the highest figure since December 2016. Also, a record 51% of these purchases were made without the use of finance. Across 2020 investors will buy around 134,000 homes, up slightly from the 133,000 bought in 2019.
Hamptons says that the average price paid for a home by a landlord in November was £180,000, around £80,000 less than that paid by an owner-occupier. This means a typical investor who still pays a 3% surcharge will incur a stamp duty bill of £5,400 if they complete before the holiday ends. However, if they miss the deadline their bill will rise by £1,100 to £6,500.
Landlords will pay an estimated total of £365m in stamp duty on the sales they have agreed between September and November if they complete before 31March 2020. However, this figure has the potential to rise by 20% or £74m to £440m if the stamp duty holiday is not extended and they complete after the end of March next year.
Regionally this rush has been concentrated in the Midlands and the North. 22% of homes sold in the West Midlands were bought by an investor, followed by 18% in both the North East and North West. In London, the figure stands at 15%, up 2% from three months ago.