British house price growth edges up, investors rush for buy-to-let
Stamp duty to increase from April
Investors are trying to beat a tax increase on buy-to-let properties in Britain, helping to push up house prices last month, a survey showed on Thursday.
The Royal Institution of Chartered Surveyors (RICS) said its monthly house price balance rose to +50 from +49 in November, in line with a Reuters poll of economists.
Overall demand for new properties rose to a three-month high after the announcement that a higher rate of real estate purchase tax would be introduced in April for investors seeking to buy properties in order to rent them out.
Simon Rubinsohn, RICS’s chief economist, said a further heating up of the housing market was likely before April and the survey’s measure of house price expectations hit its highest level since April 2014.
In a bid to cool down strong growth in the sector, British finance minister George Osborne announced in November that buy-to-let (BTL) investors will have to pay a 3 percentage point higher rate of stamp duty than residential buyers from April.
BTL investors accounted for almost one in four house purchases funded by a mortgage last year, a chunk of the market unseen in other big economies.