According to the NLA (National Landlords Association), the number of residential landlords looking to sell their properties to avoid the increase of the Capital Gain Tax (CGT) has jumped.

The association is worried about the future of the market if the CGT would be replaced by a new rate.

As a matter of fact this sudden rise of available properties may have a very negative impact on the real estate’s value.

Estate agents have been dealing for the last few weeks with a “flood” of enquiries from landlords panicking to sell properties before the increase of the tax. Besides, landlords are concerned that they might not be able to complete their transaction on time.

“There has been a noticeable level of increase in the number of landlords coming to us to ask about selling their buy-to-let properties, with some choosing to actually put them on the market to try to avoid the potential CGT liability,” said James Hyman, a partner at the south-east England estate agents Cluttons. “However, most of them want to know whether they have enough time to get the sale through to the point of exchange and whether they would get full price for the property.”

There is lot of confusion among landlords regarding the exact date of the tax change; however they will get more information soon when the first budget is presented in parliament.

Not all landlords would be rushing to sell according to Stephen Ludlow, director of Ludlow Thompson, even if his agents had dealt with lots of enquiries from landlords: “Most investors are interested in long-term, high-yielding properties, not short-term capital appreciation, so they are unlikely to be deterred by a hike to CGT.”

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