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Banks report new year buy-to-let rush

January 2016 saw borrowing from High Street banks rise to its highest level since mid – 2008. The British Bankers Association (BBA) said investors are keen to complete before the new tax rules come into force as the number of mortgages approved for house purchases was 27% higher than a year earlier.

From April 1st, most owners in England and Wales will pay a 3% surcharge on stamp duty on purchases of buy to let properties and second homes. More details of this can be found here.

The Council of Mortgage Lenders (CML) reported an eight year high in mortgage borrowing.

However, although it seems mortgage lending is rising, the number of property sales that have actually been completed is yet to pick up quite significantly.

The new stamp duty surcharges is expected to raise £1bn extra for the Treasury by 2021, but landlords have argued it will “choke off” investment in rented properties.

Samuel Tombs, Chief UK Economist for Pantheon Macroeconomics, said demand will continue to exceed supply in the property market, pushing up house prices as a result.

So as an Investor, what does this mean to you? If more mortgages are being approved, house prices are set to rise and there is less than month before stamp duty rates rise, it seems now is probably the best time to get to start investing.

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