For over a decade, landlords and property investors across England and Wales have enjoyed a significant financial perk known as Multiple Dwellings Relief (MDR). This relief applies when purchasing multiple properties, either in a single transaction or in transactions that are connected. MDR allows buyers to pay a reduced rate of stamp duty, which can lead to substantial savings, especially for those dealing with several properties at once.

However, this is all set to change. The government has decided to scrap this relief, a move that is poised to shake up the property market significantly. The changes mean that from 1st June 2024, anyone buying multiple properties will have to pay the full stamp duty rates, potentially increasing the costs of such transactions dramatically.

The Rush to Beat the Deadline

With the abolition of MDR looming, there is a narrow window of opportunity for sellers to take advantage of the current relief. This has made selling properties by auction an attractive option.

Oliver Prior, an experienced auctioneer and the National Commercial Director at Auction House, stresses the benefits of this route. He notes, “Landlords facing the abolishment of Multiple Dwellings Relief should seriously consider the auction route. Auction offers a streamlined process to sell properties quickly and with certainty, providing a viable solution for those looking to divest their portfolios efficiently and before the 1st of June.”

The Impact of These Changes

The removal of MDR is expected to have a broad impact on the property market, particularly affecting investors and landlords specialising in multiple-dwelling portfolios. The financial implications could deter new investments and reshape current strategies. For those looking to sell, the race is on to finalise deals under the more favorable current tax conditions, making auctions an increasingly popular choice.

As the deadline approaches, those involved in property investment need to assess their positions and consider their options carefully. The coming months may see a surge in auction activity as landlords and investors rush to beat the clock on tax savings.