The second thing I would like to highlight this month is the new SDLT (stamp duty land tax) increases being introduced on the 1st April 2016.
This came as a bit of a bomb shell in the 2015 autumn statement catching many people off guard.
It is suggested that the increase in mortgage lending in the latter part of 2015 and the first part of 2016 is due to the rush to buy investment properties before the April 1st stamp duty surcharge deadline.
The number of mortgage loan approvals for house and apartment purchases rose to 70,837 in December – the increase was against the usual end-of-year trend and compares with an average of 69,462 over the previous six months.
The number of approvals for re-mortgaging was 41,708, compared to the average of 39,540 over the previous six months, while other mortgage lending also rose to a level above the half-year average.
Buyers borrowed £12.3bn – up from £10.1bn in the same month of 2014 – while re-mortgaging rolled over £4.8bn of loans, up from £3.8bn a year earlier.
All the figures come from the Bank of England’s latest report.
“December was the busiest month for re-mortgaging in over two years, with activity growing more than twice as fast as overall approvals. The continued appetite for re-mortgaging was likely to be a sign of home-owners eager to capitalise on market competition and lock into lower rates” says Peter Williams from the Intermediary Mortgage Lenders Association.
It seems a bit of panic buying if you ask me, as our subsidiary company Godirect-propertysales.com has been responding to many investor enquiries this month and indeed sales, but much to do with the left hand not knowing what the right is doing. if you consider the RICS (Royal Institute of Charted Surveyors) report November 2015 which estimates 4.5% capital growth this year and for the next 5 years on the trot, making a growth of just short of 22.5% and growing further going forward making the 3% SDLT a bit negligible, don’t you think?
Then there is the ‘Alice in Wonderland’ Tax but more on that as it develops.
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