Analysis from Paragon Bank highlights a significant shift in the buy-to-let property market, particularly in Southern England, following the introduction of the stamp duty surcharge for additional properties in 2016. The proportion of buy-to-let properties purchased in Southern regions has steadily declined since 2015, with notable decreases in areas such as Greater London, the South East, and the South West.

Conversely, regions like the North West and Yorkshire & Humber have seen an increase in the proportion of buy-to-let purchases. This shift suggests investors are diversifying their portfolios away from Southern England, possibly due to the impact of the stamp duty surcharge on profitability.

Richard Rowntree, the managing director of mortgages at Paragon Bank, emphasizes the need for a vibrant private rented sector across the UK to meet the growing demand for rental properties, driven by population growth. He highlights the importance of addressing supply issues to prevent further rental price increases, particularly in areas with significant supply/demand imbalances.

Overall, the data underscores the complex interplay between policy changes, regional housing markets, and rental demand, signaling the necessity for proactive measures to ensure a balanced and sustainable rental market across the UK.