Very few buy-to-let landlords will take advantage of the cut in capital gains tax this month to offload investment property, according to a survey of the market. Financial Times

Tax experts had feared that property would flood on to the market from shortterm buy-to-let investors seeking to capitalise on a substantial drop in tax at the beginning of April.

But just 2%of landlords say the tax change will mean they sell their properties when current tenancies end, according to a RICS report today.

RICS surveyed 500 residential letting agents, who said the landlords on their books were still mostly comfortable holding on to property, owing to the widespread increase in rental levels.

'Significantly, with the reduction in loan-to-value ratios by lenders leaving first-time buyers struggling to access the housing market, rents are now rising sharply and the expectation

is that this trend will continue,' said Simon Rubinsohn, RICS’ chief economist. 'The incentive to cash in on the lower tax rate is being outweighed by attractive yields.'

The survey showed that 4.6% of landlords in total were planning to sell their properties on the expiry of tenant leases in the first quarter. This is a reduction from the 6.5% who said they were planning to sell in the fourth quarter of 2007.