Without a doubt, the housing market is vital to the economy. Like many other industries, it has suffered from the Covid-19 pandemic, as people are now cautious about buying a home. Wage cuts, massive unemployment, stagnating job market, and business failures led to uncertain times for the housing market. The economic situation has also worsened because of Covid-19 limitations.
However, the government’s stamp duty holiday that started in July was meant to revive the economy. This measure was originally introduced to revive the property market as the lockdown eased and help the economy by the cash flow from the housing market. Right now and until March 31, 2021, buyers have to pay immediate stamp duty only on property above £500,000 in England and Northern Ireland. The threshold was raised from £125,000 to £500,000, which is excellent news for investors looking to offload parts of their portfolio to new buyers or indeed, purchase new properties themselves.
How can property businesses benefit from the stamp duty holiday?
Without a doubt, the recent stamp duty holiday is the best opportunity in years. As the purchase will be cheaper, the BRR property strategy will work best. Investors have all chances of finding a property that will meet intricate requirements and quickly put it to work. One can even sell it before the stamp duty holiday ends because the buyers also seize the moment for a great deal.
BTL landlords, on their behalf, will also benefit from the stamp tax duty. Without having to pay the full stamp tax, the whole buy-to-let project will cost less. This is because there is only a 3% tax on additional properties of anything up to £500,000, applied as a flat rate.
As for the houses of multiple occupation, their owners will certainly experience a boom after they buy a property. The HMO strategy will be the most beneficial for the houses in the areas far from the city centre. During the pandemic, there are new tendencies in the housing market, including the people’s tendency to relocate to less urbanised areas.
Find Opportunity Fast
The only drawback of the stamp tax duty is that the opportunity is limited. Landlords have to find the opportunity in a small time period. Sure, searching for such an opportunity requires lots of work, because it comprises searching for property in portals, dealing with vendors, documentation, and mail marketing. Luckily, today is the digital age that allows for the automation of these processes.
The stamp duty holiday is great for those who can find the best opportunities in a short space of time. Our tool PSEngine can make an advanced search in property portals allowing for you to quickly find and analyse a potential deal.
In a time when people are buying more reluctantly because of financial, economical, and political instability, the months before March 31, 2021 there is a real chance to make a good investment. The stamp tax duty may help build business portfolios even in uncertain times.