Stamp Duty Changes

As from 1 April all residential property purchased as a second home or buy-to-let investment will see an additional 3% stamp duty charge.

To break this down, if you purchase a property for £150,000 after 1 April 2016 you will pay £3,750 on the first £125,000 and £1,250 on £25,000 giving a total of £5,000 in stamp duty (an increase of £4,500).

There is actually no stamp duty charge on properties costing less than £40,000 but the days of buying a house in Newport for that sort of money are long gone!

This controversial charge comes hot on the heels of last year’s reductions in buy-to-let tax relief and a number of new regulations that have come our way. Despite this measure being seen as a way of encouraging home ownership, I still feel investing in property is a viable option. Here at Barbers we are currently letting 25% of our properties to people in family break-up situations and 10% of our properties to people moving to the Newport area through job relocation; these make up groups of people with no interest in purchasing who see renting as an acceptable lifestyle choice.

So far in 2016 we have seen an increase in demand from tenants. Properties are letting quickly with a number of applicants chasing new builds in particular and properties off Wellington Road proving very popular. We really do need stock to replace what we have let to meet the demand.

Smoke Alarms

Over the past few months this subject keeps occurring; remember landlords now have a duty to ensure that smoke alarms are installed in rented properties, one on each floor. We have had a number of instances where properties have heat detectors fitted rather than smoke alarms, they are fine but in order to be compliant you still need smoke detectors. The reason is that heat alarms and smoke detectors operate differently. In the event of a fire, a smoke detector, because it works on detecting smoke, would sound earlier and give the tenant the maximum time to evacuate. Heat alarms work on temperature and therefore would activate once the temperature in the property started to rise. Any additional detectors within the property are always good to have. However, smoke alarms should be the first priority fitted in the circulation areas.

For advice on all rented property matters please call our Newport Office on 01952 820239 or email me, Richard Heath at r.heath@barbers-online.co.uk. •