According to latest ONS figures the average price of a UK property has soared to an equivalent of 9.0% leading up to March 2016. Part of this increase has been due to buyers purchasing buy-to-let properties which peaked in advance of the 1st of Aprils 3% rise in stamp duty on second properties.
However, barnstorming though it is, this March data is already looking dangerously anachronistic.
It gives an enticing snapshot of a property market running at full steam in the final weeks before April’s stamp duty hike.
With annual price rises in England reaching double figures, and prices in the usual suspects of London (13.0% increase), East Anglia (12.1% increase) and the South East (12.2% increase) rising even faster, March has proven to be a high water mark.
But with the impetus provided by the stamp duty deadline now gone, demand from buy-to-let buyers has eased – and this is helping the market return to more normal levels of price growth.
However, this gently cooling market may mark an opportunity for buyers, as some sellers are being forced to reassess their overly ambitious asking prices.
On the front line we’re seeing many mid-range properties in the most desirable locations selling for below asking price – hinting that the power dynamic is shifting from a seller’s to a buyer’s market.
In particular, investment properties of the sort favored by buy-to-let buyers are being discounted as developers seek to offset the extra stamp duty.
With the EU referendum still close to call, the prospect of a Brexit will make its presence felt more in May and June as some investors hold off their purchases until the uncertainty is over.
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