In this post credit crunch world of sub
terrain low interest and annuity rates so low a limbo dancer would smart, the
growth of buy to let since 2009 has been phenomenal. So much so, there has been
an evolution in purchase of property in the UK from that of just buying the roof
over one’s head to that of a buy to let investment where it is seen as a standalone
financial asset to fund current and future (ie pensions) investment. So
recently, a few days before the release of latest Land Registry data of property
transactions, quite a few market commenters were anticipating a huge increase
in the number of properties sold in January as the 1st of April
2016 stamp duty deadline got closer.
Looking at the most recent set of data
from The Land Registry, it seems there has been a drop in the number of
completed property sales in the Lincolnshire County Council area. Year on year,
completed property sales in January (the latest set of data released)
fell by 10.41% to 800 compared with 893 in January 2015.
Nationally, the number is similar, as the number of completed house sales fell
by 5% in January 2016 compared with January 2015. Some might say this
counters the reports that there was a rush by landlords to buy ‘buy to let’
property ahead of the 1st April 2016 deadline but where was the
stampede that many expected?
Looking even closer to home, in the NG31
postcode in January 2016, 44 properties changed hands, whilst 65 properties did
so in January 2015. It’s even more interesting when you look at the average
price paid, in January 2016, it was £159,500 yet in January 2015, the average
price paid was £153,887.
Is the buy to
let dream over for Grantham landlords?
.. but as ever my Grantham Property Blog
readers, the devil is in the detail. The 3% stamp duty surcharge for buy to let
landlords was announced in the Autumn Statement on the 25th November
2015. Anyone who has bought a property knows from their offer being accepted to
receiving the keys and monies paid is a long drawn out affair, taking on
average 8 to 12 weeks, as the Land Registry only get notified upon completion
of the sale. We also need to factor in that Solicitors seem to have the last
two weeks of December off anyway.
So if there was a rush in the last few
days of November/early December in the Grantham property market, we would only
see the results of that in the February figures (released in June) and more
probably March’s (released in July).
So why all the doom and gloom? Simple ..
bad news sells newspapers and gets the headlines. Let’s be honest, the headline
to this article is designed to be eye catching. However, when we look at both
the bigger and smaller picture; nationally, property values dropped (month on
month) by 0.5%; in the East Midlands region they dropped 0.3%, whilst in Lincolnshire
they rose by 0.5%. The year on year figures tell a completely different story
to that.
It just goes to show you should look
deeper into something before making a judgment! For more thought provoking
commentary on the Grantham property market – please visit the Grantham Property
Blog
