£4,400 boost to Gloucester First time buyers

There’s a whole legion of wannabe Gloucester first-time buyers keen to get on the property ladder and they now have a 3% price advantage over the previously quicker responding army of Gloucester landlords with cash at the ready. Since the start of April, buy to let landlords have had to pay an additional 3% stamp duty so whilst demand from some Gloucester buy to let landlords has dropped away, in the interim, it offers Gloucester first time buyers  a chance to fill the vacuum with less competition from cash rich landlords (over two thirds of BTL properties were purchased without a mortgage in the last 7 years) who could bid more and complete quicker.

Looking at the average value of a terraced house in Gloucester currently standing at £148,300, that means if our Gloucester FTB went up against a Gloucester landlord, the landlord would have to pay an additional £4,449 in stamp duty. Early anecdotal evidence from fellow property professionals in the city is suggesting landlords are reducing their offers slightly on Gloucester properties to reflect the extra stamp duty.

Whilst on the face of it, it appears landlords are being punished by No.11 Downing Street, I actually believe this increase in stamp duty for landlords is a good thing for the Gloucester property market as a whole.

Since 2011/12, the Gloucester property market has performed very well indeed. Over the last 12 months, £574,284,171 has been spent buying 2,829 Gloucester properties. Figures from the Land Registry have just been released and month on month in our council area, property values are 0.1% lower, yet 4.3% higher year on year. These figures are nowhere near the heady days of 2003 (February to be exact), when Gloucester property prices rose by 24.3% in 12 months.

So as property values in Gloucester (and the UK as whole) start to stabilize and come back to some kind of balance, I am beginning to see savvy landlords view the Gloucester property market in a different light. Even with the Spring rush, gone are the days where you could make limitless money on anything that had a door, a few windows and roof. This stamp duty change has made more and more landlords,  take advice on what or not to buy and what to pay, meaning Gloucester landlords are being more calculated with their Gloucester BTL purchases.

What effect Brexit may have remains to be seen, however there is still an acute housing shortage so probably over the medium/ long term , thinks will carry on as usual.