Property transactions slip in December; rise yearly: HMRC

Latest figures from HMRC describe residential property transactions dipping 0.1 per cent from November to December, totalling 102,330 completed.

Measured annually, however, the number of transactions were 3.6 per cent higher than seen in the previous December.

Looked at on a non-seasonally adjusted basis, the figures show that transactions sank 11.5 per cent from November and dropped 2.9 per cent annually.

The figures also show that during the calendar year of 2018, on a seasonally adjusted basis, 1.19m properties were sold, down from the 1.22 that changed hands in 2017.

Yopa chief property analyst Mike Scott provides an explanation for the discrepancy between the monthly and yearly figures: “The first quarter of 2018 was quite slow, with the bad weather caused by the “Beast from the East” reducing activity in the housing market, and so we expect the year-on-year comparisons to continue to show an increase as we move into 2019.

“The economic fundamentals for the market are still strong, and affordability has improved, but there is no sign of a renewed house price boom. Assuming that a chaotic no-deal Brexit can be avoided, we therefore expect that overall housing market activity will be much the same as it has been in every year since 2014, with an average of 100,000 homes sold every month,” he adds.

Legal & General Mortgage Club director Kevin Roberts comments: “Transaction levels continue to tell the same story of stagnation. Political uncertainty, the cost of moving and barriers such as stamp duty are leading some homeowners to ‘improve, not move.’

“The government’s extension of the Help to Buy scheme and a stamp duty exemption to shared ownership properties will help those further down the ladder, yet there is more work to be done.

“Extending this break to last-time buyers would free up larger properties for growing families, enabling the next generation of homebuyers to step onto or even up the property ladder,” he says.

Kensington Mortgages new business director Craig McKinlay offers a similar point of view: “What’s needed is clarity. Only once people feel secure, will buyers feel comfortable making the moves which are necessary to ease pressure on the housing market. Removing financial barriers for those looking to downsize, for example stamp duty, would be a sensible move in freeing up larger properties for those looking to move up the ladder.”

Spicerhaart business development director Neil Knight offers another angle: “When you bring new housing into the picture, it is clear that activity is very much on the up. In fact, construction output hit an all-time high in November 2018.

“This suggests that while Brexit uncertainly may be having an effect on transactions in terms of those who maybe want to move but don’t need to, new housing is still very much needed for those who have to move or are looking to make their first step onto the housing ladder.”

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