Stamp duty is undoubtedly a heavily debated issue within the UK property industry. For those unsure about what UK Stamp Duty is, it’s a compulsory tax on any property purchase above a certain threshold, excluding first-time buyers. Those who are investing in property, or who own a second home, have to pay an additional 3% surcharge.
Back in March, Rishi Sunak, the Chancellor of the Exchequer, delivered his first budget speech, updating Parliament on the government’s spending plans for the next year. Sunak confirmed plans to increase stamp duty land tax (SDLT) to 2% for non-resident buyers of property in the UK. Whilst this isn’t great news for overseas investors, the surcharge wasn’t set to go into effect until April 2021. However, whilst there are no official changes as of yet, many property industry experts have urged the government to offer a stamp duty holiday to buyers in an effort to aid recovery after Covid-19.
As it stands, property investors, landlords and anyone buying a second home is required to pay a 3% stamp duty surcharge. However, many in the property industry have asked for this to be ditched in an attempt to bring more buyers to the market.
Whilst the government has reopened the housing market in England, more needs to be done to encourage purchases, including in the buy-to-let sector.
Changes in the UK housing market
Long before the lockdown, the UK’s housing market had been changing. Over the last decade, the number of homeowners dipped, with many choosing to rent for longer rather than own their own home. This change in the market is down to a number of reasons, many people prioritise living with friends rather than staying with parents to save for a house deposit. In addition to this, house prices vs earnings have increased over the last thirty years, meaning it takes a lot longer to save up and get on the property ladder than before.
According to the latest English Housing Survey, one in five households in England live in the private rented sector, making it the second largest tenure. Because of this change in the market, in many areas of the UK, the demand for rental housing far outweighs the supply, especially in big cities like Manchester. Manchester City Council predict a population growth of 5,000 people per year by 2025, again highlighting the need for more rental properties in the area. Luckily for the future tenants of Manchester, Beech Holdings have a number of new developments under construction in the city centre.
One of these investment opportunities is located in the much sought-after Ancoats area. Ancoats Gardens is a luxury residential development with two roof gardens, 155 high-spec apartments, an exclusive on-site gym, coffee roastery and shared social space for tenants. Ancoats Gardens has a projected 7% rental yield, which isexpected to grow 3% every year. In addition to this, the development is fully managed,from development through to lettings and property management.
If you’re interested in investing in our Ancoats Gardens development, or want to find out about any of our other developments, get in touch with our team today.