Agents have almost unanimously been reporting a big surge in business since the reopening of the housing market, but new figures from HM Revenue & Customs suggest there is still some way to go before normal volumes are seen.
A total of 68,670 residential properties were sold in June according to HMRC data.
While this was predictably a huge 50 per cent up on May, it was still 31.5 per cent down on the same month a year ago.
The figures obviously pre-date the stamp duty holiday and other purchase tax changes in different parts of the UK, introduced only this month.
“Transactions, not more volatile house prices, are always a better indicator of market strength. These figures show activity is moving in the right direction but will clearly take time to be reflected in the figures as we emerge from lockdown and associated restrictions” notes former RICS residential chairman Jeremy Leaf, who also runs his own London estate agency.
“Nevertheless, we have noticed at street level that many buyers and sellers are bringing forward moving decisions to take advantage of the stamp duty holiday and continuing lower interest rates. There is still concern that improved conditions will be relatively short-lived as economic news deteriorates and furlough support falls away” he adds.
The chief analyst at online agency Yopa, Mike Scott, says it’s possible that these HMRC figures may be worse than reality.
"Note that these are provisional figures. Transaction data may be being processed more slowly than usual due to the effects of the pandemic, which means that there may still be more June sales to be reported and the true year-on-year fall may not be as bad as it is in this report” he suggests.
And Tomer Aboody, director of property lender MT Finance, says: “We are still below last year's numbers, which in turn were down on the previous year, but confidence is creeping back up.
“If the government increases capital gains tax on principal home sales, it will push us back again so any progress made by the stamp duty reduction will be swiftly lost. We need more stimulus via reduced stamp duty to the upper end of the market and hope for this in the autumn Budget.”
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There is a continuing confusion between the media and Estate Agents. The media gets its stats from sales completions whilst agents talk about sales agreed. As there is typically over 80 days between what agents report from the coal face and what journos report from the back end stats they are often at odds. The public sees the newspaper headline not knowing the news is almost 3 months out of date on what the trend may be. The BBC are a classic example of this. Of course completions in May and June would have been lower this year then 2019 but look at sales agreed over these 2 months and hey presto the story is the reverse. Neither stats are wrong, it’s just how they are interpreted.
In any case, it's just the calm before the storm and the UK gov know it, hence their action to try and prevent a collapse. House prices always go the opposite way to unemployment so you do the math.
The media get it wrong, often intentionally to get the big head line. There is billions of pound printed on purpose. There is "loads of money" in the economy. This is not the 2008 crash. This is totally different. Oxford are close to a vaccine. People are desperate to move. Money is there. Most of redundancies will be in the younger age group who sadly are unable to buy in any event.
Suspect your post will not age well and no idea what a vaccine has to do with the housing market.
Slumping rents, high interest rates from lenders on high ltv and unemployment will kill the market slowly but surely.
I imagine it'll stagnate and cgt changes will leave landlords clinging to tenants.
Goodness it feels like we may have killed the golden property market goose over the last few years. We need more younger people buying starter homes.
I know lots of people in their 20s, including my tenants, and they are hustling hard and really trying to get their rent down. The attitude is, we'll if buying isn't happening I won't be paying 40% of my wage on renting a shoebox.
Bless them, when I was their age I paid about 8% of my wage on rent and I was secretary.
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