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MoneyWeek article- End of multiple dwellings relief

Journalist: Marc Shoffman, Freelance

ended 30. May 2024

Multiple Dwellings Relief is set to be scrapped from 1 June.

I am seeking views on whether landlords/property investors are rushing to get contracts completed today/tomorrow ahead of the deadline?

What impact will the scrapping of the relief have for property investors?

How can property investors prepare for the end of the relief?

Many thanks

Marc

2 responses from the Newspage community

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Kundan Bhaduri
Property Developer and Portfolio Landlord at The Kushman Group
We have closed a number of deals where MDR was sought. This was a loophole that has unfairly favoured developers and large portfolio landlords to the detriment of retail buyers and should have been removed a while ago. The most common use of the MDR relief for portfolio landlords is when buying a block of flats. In the Midlands and across the North East, it is not uncommon for portfolio landlords and investors to buy a block of say, 8 x £60k flats. That's still under £0.5m, which would barely buy you an apartment in outer London. So effectively, MDR helped investors looking to buy blocks. Other use cases for MDR would have been semi-commercial blocks with shops on the ground and apartments above across high streets in most major towns. These types of transactions will now slow down and will increase the cost of converted apartments, since the developer will have to pay more. Acquisition costs of granny-annexed homes will also increase as a result of these changes.
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Editor
Michelle Lawson
Director at Lawson Financial
Multiple Dwellings Relief (MDR) isn't used by the majority of people but it was a Stamp Duty loophole that has been closed. In the current climate that is so unfavourable to landlords, it is another nail in the coffin for the sector and those landlords who do buy multiple properties. On the whole, though, I doubt it will be missed by many.