Buy-to-let mortgage sales slumped 26.2 per cent (-£1.04bn) from February to March, according to Equifax Touchstone analysis, despite the expected last minute rise ahead of the 1 April stamp duty hike.
Residential sales were up 1.4 per cent on February to £12.95bn, the highest month sales figures since the 2008 market crash. Combined, residential and buy-to-let sales for the intermediated market declined by 5.1 per cent (-£855.7m) on the previous month.
Scotland was the only region to increase its mortgage sales in March, while Northern Ireland saw the steepest fall, down by almost 20 per cent. London followed, with a drop of almost 10 per cent in mortgage sales month-on-month.
As of 1 April 2016, buyers have be subjected to an extra 3% stamp duty charge on buying a second home.
Regional area | Change in total mortgage sales in March |
Scotland | + 8.2% |
South East | - 1.4% |
Midlands | - 2.3% |
North East | - 3.8% |
North and Yorkshire | - 3.9% |
South Coast | - 4.9% |
Wales | - 5.3% |
South West | - 5.4% |
Home Counties | - 7.5% |
North West | - 7.8% |
London | - 9.7% |
Northern Ireland | - 19.8% |
The data from Equifax Touchstone, which covers 92 per cent of the intermediated lending market, also showed the average value of a residential mortgage in March was £190,091 - up from £179,187 in 2015 - and £157,819 for buy-to-let - from £151,753 a year ago.
The firm’s relationship manager Iain Hill said recent buy-to-let flows indicate borrowers took the advice of their lenders and initiated transactions in good time to avoid an eleventh-hour panic.
“The big question from here is, to what extent will the new stamp duty rates discourage investors from entering into new deals? With so much economic uncertainty, property remains an attractive investment option for many people.
“Given the rollercoaster first quarter of 2016, it will be interesting to see where sales trends go from here.”
Oliver Marley, research assistant at broker Independent James, said it would appear that mortgage advisers saw how important it was to get buy-to-let applications submitted in February rather than waiting to March.
“It looks like volume of business forced people to submit much earlier than normal as all parties involved in the transaction were much busier than normal. You’ll find that cash purchases of buy-to-lets will be at an all-time high in March; if there were any properties left that is.
peter.walker@ft.com
