Some 60% of multi-property landlords have expanded their property portfolio since the introduction of the stamp duty holiday in July 2020, according to research from Direct Line for Business.
The report shows landlords have been strategic with their purchases; 43% have invested in properties outside major cities, with 82% doing so because they anticipated renters moving out of cities due to the Covid-19 pandemic and an upsurge in remote working.
Half of landlords feel the stamp duty holiday has kept the property market afloat during the pandemic, while 43% say that it has encouraged them to accelerate plans to purchase properties.
Jamie Chaplin, landlord business manager at Direct Line, comments: “It’s been encouraging to see the property market so buoyant since the stamp duty holiday was introduced.”
“And it’s been interesting to see more landlords invest in rural properties, suggesting they’re responding to the rise of flexible working and the possibility of people leaving major cities to work remotely.”
While the Chancellor is expected to extend the stamp duty holiday for three months in this week’s Budget, nearly half (45%) of landlords fear that the eventual end of the holiday could heavily impact the market and the value of their portfolios. This is prompting many to take desperate measures to try to get their purchases over the line as soon as possible.
A third (30%) are prepared to cut corners to ensure their purchases are completed before the expiration date – for example, taking on aspects of the conveyancing process themselves or even skipping a rigorous property survey. Three quarters of landlords would pull out of transactions if they did not complete their live purchase by their desired date.
The pandemic is also influencing the way landlords use their properties. Some 36% have changed their type of let since March 2020:
14% have listed their property as a holiday home, short-term let or Airbnb
14% have changed their property to a bed and breakfast
11% have changed commercial property to residential
7% plan to make changes in the future
For landlords and investors looking to grow their portfolio and take advantage of the stamp duty holiday, protecting your new property with adequate insurance is a top priority.
Last week, we asked whether Covid-19 is actually harming the buy-to-let market, which you can view here.