The UK’s buy to let sector has seen a surge of activity as property investors have rushed to complete their transactions before the new Stamp Duty surcharge comes intoforce next month.
In February, the number of buy to let valuations carried out increased by 34% compared to the same month last year. Meanwhile, remortgaging activity, which includes buy to let activity, was up 41% over the same period.
In addition, buy to let activity saw a month on month increase of 25%, while remortgaging volumes climbed 6% in February compared to the previous month, largely driven by buy to let remortgaging, according to the data from Connells Survey & Valuation.
It confirms much of the anecdotal evidence that the extra 3% Stamp Duty surcharge on second homes or buy to let properties due to take effect on sales completed after 01 April 2016 has resulted in increased demand from buy to let investors.
In addition, the home mover and first time buyer sectors have experienced strong monthly rises in valuation activity.
The number of valuations carried out for first time buyers surged by 36% between January and February 2016, while those carried out for home movers grew by 35% over the same period.
Activity for both these sectors appeared steadier on an annual basis. Those taking their first step onto the property ladder in February reported a 9% increase compared to January and home movers experienced an 8% uptick on the same month on month basis.
Overall valuation activity also performed strongly. The total number of valuations carried out in February represented a 21% increase on the same month last year. Meanwhile, on a monthly basis, valuation volumes as a whole rose by 20%.
John Bagshaw believes that the housing market is getting into its stride in 2016 and a number of factors have precipitated this. ‘Monetary policy continues to, indirectly, stimulate property activity, as the Bank of England signals that the base rate will be held at record low levels for the foreseeable future, thus keeping the average mortgage rate down,’ he said.