Landlords who rushed to acquire homes before the new 3% stamp duty increase on buy-to-let properties and second homes are now starting to let them out, providing tenants with a much wider choice of properties, according to new research.
Fresh data from property website Rightmove shows that there was an 11.5% rise in rental properties being listed in April.
The study by investment firm Property Partner looked at 90 towns and cities across the UK and found that the supply of properties went up in 82% of them, led by Worcester, where the volume of rental listings soared by almost 50%.
Even in London, the number of homes to let increased last month, as more landlords seeked a return on the cost of acquiring and potentially renovating their newly-acquired property.
“The rental market experienced a much-needed boost in April. Unfortunately, this was created by investor frenzy to beat the stamp duty hike, and supply is unlikely to continue on an upward trajectory,” said Dan Gandesha, CEO of Property Partner.
But despite the pick-up in housing supply in the market, Gandesha believes that option for tenants could become more limited in the next couple of months as traditional landlords balk at the prospect of paying the surcharge now, and losing mortgage interest tax relief from next year.
He added: “There is still strong tenant demand, but the government has changed the traditional buy-to-let landscape, and this will have ramifications for the rental market longer term. That demand will increasingly have to be met by professional landlords like Property Partner, offering tenants a better product, and investors a better deal.”
The UK towns and cities saw the biggest rise in new rental property listings in April compared to March:
Worcester, West Midlands - 48.9%
Chelmsford, East - 38.0%
Stevenage, South East - 36.4%
Southport, North West - 34.4%
Telford, West Midlands - 32.3%
Cheltenham, South West - 30.3%
Watford, East - 29.4%
Bath, South West - 29.3%
Newport, Wales - 27.0%
Woking, South East - 26.8%
Gloucester, South West - 26.4%
Milton Keynes, South East - 24.7%
Oxford, South East - 24.5%
Oldham, North West - 23.3%
St Helens, North West - 22.5%