Changes announced at the end of last year will add 3% points to the rate of stamp duty / LBTT paid by those who already own property, from April 2016. This rise in the tax that landlords and second home owners pay to buy a property could have a devastating impact on the buy-to-let market as landlords’ margins are squeezed even tighter.
For example, someone buying an additional property worth £150,000 will pay 10 times more in tax after the change than they do today.
The changes could have a negative effect on the property market in Edinburgh, with investors not seeing it as attractive. Experts say that they could see a drop in demand for traditional ‘buy-to-let’ types of properties and that it could trigger a wave of sell-offs from buy-to-let landlords looking to avoid the surcharge in April 2016.