HMRC data shows “strong” property market ahead of Autumn Budget
HMRC has published its latest Transaction Data, which shows that the UK property market is “strong” ahead of the Autumn Budget.
HMRC recorded a ‘marginal’ decline in property sales during August but figures remain up on a yearly basis.
The latest property transaction date from the taxman – based on Stamp Duty returns – shows there were 90,210 residential sales for August on a seasonally-adjusted estimate.
The figure is up by 5% annually but down less than 1% since July.
On a non-seasonally adjusted estimate, the figure is up 10% annually and by 8% on a monthly basis to 104,330.
The figures remain below pre-pandemic levels.
It comes as mortgage rates and inflation have been falling, boosting buyer demand.
Iain McKenzie, chief executive of The Guild of Property Professionals, said:
“Another ‘marginal’ fall in property sales should not spell disaster for the property industry, especially considering the healthy volume of sales we have seen so far this year.
“In many areas of the country, there is not enough good-quality, yet affordably-priced housing to meet the unprecedented levels of demand that estate agents are seeing.
“First-time buyers are choosing to sit tight, with hopes that market conditions will go in their favour.
“For others, it is simply a case of affordability concerns.
“Saving for a deposit is challenging at the best of times, but with living costs still high, and energy prices set to increase this winter, it makes the process even more difficult.
“The Bank of England has made some cautious progress in lowering interest rates as a result of falling inflation levels in the past year.
“It is anticipated that it will continue to be much of the same as the year comes to a close, dashing hopes of a steep decline in mortgage rates and acting as a deterrent to first-time buyers.”
One potential stumbling block for the market is next month’s Budget.
McKenzie added:
“We are hopeful that there will be some practical changes that will help reassure sellers and get more people on the property ladder.
“Potential increases to capital gains tax may have panicked some landlords to sell up while rates are lower, however our members have not noticed a significant influx of available properties on the market.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, added:
“Although inevitably reflecting what was happening at least a few months ago, transactions are still a better indicator of market prosperity than more volatile prices.
“Activity remains surprisingly strong during a period when we might have expected worries about the economy, the election and mortgage rates to have blown it more off course.
“Since then, inflation has settled and borrowing costs dropped a little and a measure of political stability has returned.
“However, more property choice and Budget concerns have meant significant change over the coming quarter at least is unlikely.”
Nathan Emerson, chief executive of Propertymark, said:
“The year to date has proven transformational in terms of consumers having greater confidence and flexibility to approach the buying and selling process.
“We have seen a sizeable uplift in market conditions with aspects such as inflation staying within targeted range and mortgage deals that demonstrate some lenders are feeling buoyant enough to bring far more competitive mortgage deals to their prospective customers already.
“However, a lot will depend on base rate decisions over the coming months and the Bank of England will likely not be keen on undoing progress made so far by unrealistically lowering the base rate too rapidly.”
Kindly shared by Estate Agent Today
