AMCO lettings and Property Management Manchester

What Does Stamp Duty Land Tax Mean For Rental Yields

How will the new stamp duty charges affect buy to let and what does this mean for rental yields?

The new tiered system of Stamp Duty Land Tax chargeable on buy-to-let properties or second homes means that landlords now have to pay an additional 3% premium on their property purchases from April 2016 on all properties over £40,000.

Whilst this is a significant jump, many believe it will not deter investors as those who have the money to invest will always choose property as the top investment asset, no matter the unavoidable ancillary costs involved, which is why demand for property investment will continue even in the wake of these stamp duty changes.

That said, it is expected that rents will rise though to counteract this new stamp duty surcharge.

A survey conducted by flat-share website SpareRoom.co.uk showed that a massive 45% of current landlords plan to raise the rent in their buy-to-let property, with 18% of those saying they will raise their rent by more than 3%.

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