Finally, some good news for first-time buyers: accidental and hobby landlords are getting rid of their properties at record speeds. In UK cities, the housing market is now flooded with flats and small homes that landlords, many of whom have been only dabbling unseriously in the business for years, now want to shed as quickly as possible. According to the financial newspaper CityAM, the number of landlords looking to exit the market is at a 13-year high.
Why now? Twin pressures are pushing them to sell. First, the crisis in the mortgage market means many property owners are being shovelled onto a variable rate agreement, which means landlords may no longer make a return on a month-by-month basis. And second, perhaps more significantly, they fear a huge financial hit if they hold on and then decide to sell at a later date.
Contact us today to speak with a specialist Commercial Finance Broker to discuss how we can assist you
The chancellor, Jeremy Hunt, announced last week a reduction in capital gains allowance, which reduces the amount of money an individual can make from the sale of assets before paying tax on their winnings. This will fall from £12,000 to £6,000 in April, and then again to just £3,000 in April 2024. Great news for the public purse; bad news for property speculators.
Flooding the market reduces demand and puts a cap on prices. In fact, Halifax reported this week that house prices are falling at their fastest rate for 14 years, after reaching a temporary, artificial high in the spring of this year. That price peak was caused by a lack of properties being put up for sale, leaving potential buyers fighting it out with each other and provoking bidding wars. Cash buyers were king. How could a first-timer compete with that?
Read about the UK Housing Market via our Specialist Residential & Buy to Let Division
No longer. Now, if you’re lucky enough to have saved a deposit, here’s your chance. House prices are dropping. They will likely continue to drop for some time. For many people, the next two years could be the moment at which the housing market finally becomes accessible.
By Hannah Fearn
Source: Independent