HMRC: Brexit hits residential property deals in June

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The number of residential property deals fell by 0.9 per cent between June and July, according to new HMRC research.

The number of adjusted homeowner deals had fallen 8.3 per cent year-on-year.

The HMRC says the outcome of the European Union referendum in June was to blame for the level of transactions falling.

There were 94,550 provisional seasonally adjusted UK residential property deals in July 2016.

But Legal & General Housing Partnerships director Stephen Smith called for calm.

He says: “While there has been a slight fall in transactions this month, we shouldn’t jump to any conclusions and pin the blame entirely on the vote to Brexit.

“Though some buyers may have held off on purchasing a property ahead of the referendum, it’s important to remember that transactions have remained static for some time now, and that the seasonal lull we typically see over the summer months is also likely to have played a role.”

Stirling Ackroyd managing director Andrew Bridges says: “There’s been a slight stutter in the property markets post-referendum recovery – but it’s no cause for alarm. It’s the usual suspects making moving on to and up the ladder a challenge. Stamp duty is certainly a barrier, alongside the difficulty of deposit-saving for many, and the latest Help to Buy ISA news will do little to inspire hope for London’s first-time buyers.”

“In London these problems will sharpen over the next couple of months as lower interest rates encourage buyers to grab a property with a cheaper mortgage, putting those with small deposits at a disadvantage. The only solution to the crisis is to build our way out of the rapid house price inflation we have seen in recent years, and ensure there are enough high quality homes on the market.”

My Home Move chief executive Doug Crawford says: “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.

“Today’s figures reflect our 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.”

Crawford adds that the housing market will be strong in the long term.

He says: “High levels of demand for both rental and owner-occupied accommodation will drive transaction figures upwards, and our recently published forecast predicts the number of property transactions will rise by 20% by 2020.”