Property Prices Continue To Increase

More than half (53%) of owner-managed businesses consider residential property to be the most attractive investment option, according to the latest survey from the Bank of Cyprus UK.

This is up slightly from 52% in early November last year, despite measures designed to tackle the rise in number of buy-to-let mortgages announced by the Chancellor George Osborne in the Autumn Statement and Budget.

As of last month, landlords in England and Wales have to pay a 3% surcharge on each stamp duty band. That comes in addition to personal rate of tax relief for landlords being cut from 40% to 20% to be introduced from April 2017.

The study found that while residential property is the overwhelming favourite investment option for owner-managed businesses, just 8% see commercial property as an attractive investment. Cash investments (16%) and stocks and shares (13%) also fall far behind residential property.

Lakis Kasapis from the Bank of Cyprus UK, said: "Despite the new measures making life harder for buy-to-let landlords, demand for residential property as an investment is still strong, and surprisingly people are even slightly more bullish about buy-to-let investments than six months ago.

"We saw a rush to buy in the first quarter of this as investors capitalised on buy-to-let property purchases before the stamp duty increase took effect in April. It remains to be seen, however, if this appetite for investing in the residential market will now come to a hard stop following the stamp duty increase, or whether it will continue given the scheduled personal tax relief changes and the continued uncertainty surrounding a potential Brexit."