Yet another snub for buy-to-letters

Last week’s Budget contained yet more bad news for the buy-to-let sector. Big landlords will now be subject to the new “second home” stamp duty surcharge of three percentage points.

Last week's Budget contained yet more bad news for buy-to-let landlords. Big landlords those with more than 15 properties had expected to escape the new "second home" stamp duty surcharge of three percentage points. However, "the chancellor instead declared that all buyers of additional homes would be subject to the levy", says James Pickford in the Financial Times. Not surprisingly, M&G Real Estate thinks this will "slow down the market in the short term by adding to costs". It wasn't the only snub for the sector, reports The Guardian's Rupert Jones. Capital-gains tax was cut from 18% to 10%, and 28% to 20% except for on the sale of residential property that isn't your primary residence.

Already some landlords are trying to find loopholes that can help to minimise the impact of these changes. FT Adviser notes that some lenders are encouraging investors to transfer their buy-to-let portfolios into companies or limited liability partnerships. At the end of last year Kent Reliance published a study that predicted a large surge in property lending to limited liability companies.

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri