Average monthly rents in London in the three months to October stood at £1,560pcm – 7.5% higher compared to the same period in 2014. The difference between average rents in London and the rest of the UK is now the highest on record.
Affordability in the private rented sector is now as much of an issue as in the sales market and the hike in stamp duty on buy-to-let purchases, effective from April, plus other tax and regulatory changes, will only exacerbate the situation. Tens of thousands of landlords could sell up or be discouraged from entering the rental market in the first place, which would cause a reduction in the number of homes to rent. This could result in rent rises in the most popular locations, particularly London.
The 3% landlords' stamp duty hike
The Government opened its consultation on the proposed 3% stamp duty surcharge on 28 December, and it is to be hoped that through this process the lettings industy can suggest sensible revisions that can be introduced to ease the burden on private landlords, or tenants will be the ultimate losers as rents rise across the board.