HMRC Property Transaction data: House sales head south for the summer

Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, comments on the publication of the HMRC Property Transaction data for June 2022, showing the house sales heading south for the summer.

Key points from publication:

There were 96,290 property sales in June (non-seasonally adjusted) – down 3.1% in a month.
They were down 55% from a year earlier – but this was the peak when people rushed to buy before the stamp duty holiday became less attractive.
This is the third slowest June for a decade and down 4% from June 2019.

Sarah Coles says:

“This is meant to be bumper house buying season, but sales have started drying up. Aside from a low point early in the pandemic, we haven’t seen a June this slow in nine years.

“The spectacular drop from a year earlier needs to be taken with a pinch of salt, because this was the peak of the market, when we saw a stampede of buyers desperate to complete before the stamp duty holiday became decidedly less attractive. However, the monthly movements are starting to add up to a general downwards trend.

“We had seen higher sales in May, but lines are never entirely straight when you’re following the property market. It’s like walking a dog towards town. Tracing its path is going to be a complex zig zag depending on the interesting smells it discovers along the way, but over time you can see where it’s heading, and property sales figures are heading slowly south.

“This owes something to the fact that it’s still incredibly difficult to find somewhere to buy. Rightmove figures show that despite a shift in the balance of supply and demand, we still have a quarter more buyers than the same time in 2019 and 40% fewer sellers, so plenty of keen buyers are still being thwarted by miserable stock levels.

“However, we’re also seeing signs that buyers are getting cold feet. Demand has fallen, and those buyers who are still looking are increasingly cautious. We’re seeing fewer bidding wars, more sales falling through as buyers push for a price drop. and at the higher end of the market more people are having to accept a lower offer. These aren’t enormous shifts, but again, the overall trend is telling.

“We expect sales continue to tail off as we go through the year, it won’t be a straight line, but our zig zagging property sales figures aren’t heading in a particularly positive direction.”

Kindly shared by Hargreaves Lansdown

Main article photo courtesy of Pixabay