It was business as normal in July for the UK’s housing market, following the UK’s vote to leave the European Union, with the industry only seeing a “slight stutter” in sales.
The latest HMRC property transaction figures show that 94,550 residential sales took place in July, a dip of 0.9 per cent from June 2016 and 8.3 per cent down (around 16,000 homes) on July last year.
For July 2016, the number of non-adjusted residential transactions was about 0.7 per cent higher month-on-month,
Andrew Bridges, managing director of Stirling Ackroyd, says the figures show there is “no cause for alarm”, with the market only seeing “a slight stutter in the property markets post-referendum recovery”.
Indeed, while a short-term slowdown is expected this summer, due to uncertainty surrounding the Brexit vote, the market has also been hit by the stamp duty changes made earlier this year, which have left activity largely below the trend set in 2015.
Doug Crawford, CEO of conveyancing firm My Home Move, says the figures reflect their own experiences of the market.
“Following the referendum the vast majority of purchases went ahead without any issue, and chains were largely unaffected. In the medium term the market will remain stable, and our view is that it is strong enough to weather mild economic uncertainty, he comments.
“The minimal fall in transaction numbers between June and July shows that the property market largely shook off the short-term uncertainty of the Brexit vote. Following the referendum there was talk that the market would be quickly affected by the outcome, but these fears have been allayed with residential transactions falling by just 0.9 per cent month on month. While transaction levels remain lower than a year ago, this is in the context of a market that is still feeling the effects of changes to Stamp Duty, which led to a frontloaded first quarter.”
In the long-term, many experts have highlighted the unchanged underlying fundamentals of the UK housing market, with a chronic shortage of supply and demand fuelled by affordable finance, potentially boosted by the recent cut in the base rate by the Bank of England. My Home Move is particularly optimistic about the market’s outlook, predicting the number of property sales will rise by 20 per cent by 2020.
UK housing market still finding its feet
21st June 2016
The UK housing market is still finding its feet after a surge in activity earlier this year.
According to HMRC’s provisional figures, there were 89,700 residential property sales in May 2016, up 1.5 per cent on April but 11.9 per cent lower than the same month last year.
Richard Sexton, director of Chartered Surveyor e.surv, comments: “Too many first-time buyers are struggling to get a foothold on the property ladder as saving for rising deposits is still an almighty challenge. Small-deposit loans in May fell 5.3 per cent to total 11,981 – an unsustainable level if first-timers are to return to the housing market in a big way.
“But low inflation, rising wages and stable base rates are improving finances. And lenders are doing their bit. Competition is bringing down rates and introducing more options. These may not be a lifeline to first-timers scrimping for their first home, but they are a hint that such deals may be on offer to them in the not too distant future.”
UK property sales surge by more than two-thirds
21st April 2016
UK property sales surged by more than two-thirds in March 2016, as the market sprung forward to beat the stamp duty deadline.
HMRC’s provisional, seasonally-adjusted transaction count for residential property hit 165,480 in March, up 41.5 per cent month-on-month and a whopping 69.7 per cent year-on-year.
David Brown, CEO of Marsh & Parsons, comments: “The property market in March experienced a real rush that represented more than simply a Spring surge. Driven by a desire to avoid the 3 per cent stamp duty levy on additional homes, many investors planned ahead by hunting for new properties in January and applying for buy-to-let mortgages at the start of February, before reaping the fruit of their labour in March.
Activity is expected to cool in the coming quarter, as investors step back after bringing deals forward. Demand from buyers, though, is forecast to be fuelled by underlying low mortgage rates.
“A sizeable proportion of March’s activity was driven by homemovers and first-time buyers who are unaffected by the new Treasury levy,” notes Brown. “It will be interesting to see if first-time buyers in particular take advantage of this window by using the Government support available to them to muscle their way onto the ladder and realise their homeowning aspirations.”
Deja vu for UK property, as home sales stall?
25th February 2016
The UK property market could be suffering a case of deja vu, as 2016 starts with political uncertainty in the air and a stall in house sales.
The latest figures from HMRC show that the the provisional seasonally adjusted UK property transaction count for January 2016 was 105,940, down 2.8 per cent from the previous month.
While the figure remains 9.7 per cent higher year-on-year, Marsh & Parsons suggests the monthly dip could be a result of renewed uncertainty surrounding the UK referendum in June and the potential for a Brexit – almost exactly a year after the same pattern occurred ahead of the 2015 general election.
Peter Rollings, CEO of Marsh & Parsons, comments: “Sales activity often cools in times of political uncertainty – and the London housing market usually bears the brunt of it. First and foremost, foreign investors may be more tentative given this latest turn in events, especially as it follows hot on the heels of higher Stamp Duty for million-pound properties.
“But history shows us that the market recovered quickly from this short-term ambiguity in 2015 – and in fact, home sales have really been building momentum over the past year. The property market is chock-a-block with eager buyers, who are being propelled on by cheap mortgage finance and government support schemes. Given the extent of buyer demand, it’s a great time for existing homeowners to be thinking about their next step up the ladder, which should drive further purchase activity. For investors, the change in Stamp Duty for second homeowners in April will be an incentive to make purchases quickly over the next month. It remains to be seen how much of an impact the EU referendum will have on these current levels of confidence but go or stay, London remains an attractive safe haven in times of uncertainty.”
Update: September 2016 – David Brown has now replaced Peter Rollings as CEO of Marsh & Parsons.Google+