Throughout the last year, the UK property market has continued to outperform itself, setting and breaking records in consecutive months, and stimulating the UK’s economy beyond expectations in a time of uncertainty and instability. Now, as the stamp duty holiday tapers into its second phase, the Managing Director of Mortgages at Paragon Bank has stated that buyer demand is continuing to grow – despite the stamp duty holiday nearing its end, with over 50% of their business continuing to come from property purchases.
There is no denying that the stamp duty holiday has been a major contributing factor to the surge in buyer demand experienced over the last 12 months. The initiative, which was first introduced at the start of the pandemic in an effort to keep the property market moving, has particularly resonated with buy-to-let investors in the market. During the first quarter of 2021, over 29,000 buy-to-let loans were written for property purchases, which is a staggering 11,000 increase over the same period last year, which saw just over 18,000 buy-to-let loans written for property purchases.
In the North West alone, buy-to-let mortgages rose 30% during the first quarter of 2021, with the North experiencing impressive growth and achieving some of the highest house price increases across the country. The continual rise in house prices also resulted in a push-back of owner-occupier purchases, resulting in a higher demand for rental property, which has risen by 10.2% in city centres throughout the last two months.
Although the stamp duty holiday is nearing its end, there is still plenty of time to benefit from the holiday and save on your property purchases whilst the market is in its incredible position, with house prices across the nation increasing month upon month and rental demand remaining high. This ‘buyer’s market’ the UK property market has achieved lends itself to the investors and landlords looking to expand their property portfolio, not only with the financial support of the money saved thanks to the stamp duty holiday but with rental demand in cities continuing to rise and house prices constantly on the rise, investing early will allow buyers to reap the benefits of capital growth rates that are currently increasing exponentially.
As life begins to return to normal, the tapering of the stamp duty holiday is no surprise, and with the housing market performing exceedingly well, this growth is expected to continue into 2022.