Legal & General Mortgage Club director Kevin Roberts said “overall housing transaction figures are stagnant”, following the publication of data from HM Revenue and Customs (HMRC) which revealed that property transactions decreased by 3% between May and June, falling to 96,370.
House sale completions were also 5.7% lower in June this year compared with the same month last year.
Roberts further commented that: “Barriers to moving, such as Stamp Duty and the high price of property in our urban areas, means that for many the maxim remains ‘improve, not move’, as they seek to renovate or develop their homes, rather than move up the housing ladder.”
The Legal & General Mortgage Club director stated that the “biggest factor” is housing supply, with the UK not building enough new homes over the last decade to keep up with demand.
The latest figures come less than a week after the Office for National Statistics (ONS) house price index illustrated that house price growth in May slumped to its lowest annual rate in almost five years. On average, house prices across the UK have increased by 3% in the year to May 2018, falling from 3.5% in April and dropping to the lowest annual rate of growth since August 2013, according to the ONS index.
Commenting on the figures, former RICS residential chairman Jeremy Leaf said: “For us, the number of property transactions is always a much better indicator of market strength than house prices, with recent economic and political uncertainty reflected in these lower, seasonally-adjusted numbers. We certainly would have expected higher figures bearing in mind the spring buying season is generally the best for the property market.
“However, we are not really surprised when, on the ground, we are seeing fewer buyers nervously trying to negotiate best possible terms and transaction times lengthening as a result. We don’t expect to see any great change but have noticed more listings and viewings in the past month or so, which hopefully will be reflected in slightly higher transaction numbers later in the year.”
Resi.co.uk chief executive and co-founder Alex Depledge stated that “a decrease in June will be disappointing for those looking to sell their home”, with second-time buyers being hit by high stamp duty costs and stunting growth within the market.
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