The number of residential property deals climbed by 4.4% in August compared to July, new HMRC figures have revealed.

HMRC’s latest provisional non-seasonally adjusted estimate of UK residential transactions totalled 114,440 for August, which was also 9.7% higher than the same month last year.

UK residential transactions have been stable in recent months but remain elevated above pre-pandemic levels, according to HMRC. For example, the provisional non-seasonally adjusted estimate in August 2019 was 111,600, marginally lower than the latest estimate. HMRC stated that residential transactions have historically followed a seasonal trend in which market activity increases during summer months, a trend that the August 2022 provisional estimate has continue to follow.

For non-residential transactions, HMRC’s provisional non-seasonally adjusted estimate for August reached 9,930. This figure is a 1.7% increase on July, and 5.3% higher than August 2021. HMRC stated that the latest total is broadly in line with historic levels, after August 2019 saw 9,530 transactions.

HMRC’s monthly estimates are based upon its own records as well as those of Revenue Scotland and the Welsh Revenue Authority, for SDLT, Land and Buildings Transaction Tax (LBTT) and Land Transaction Tax (LTT), in each nation respectively.

Commenting on the latest totals, managing director of Coreco, Andrew Montlake, said: “Transaction levels in August showed there was life in the property market even as the cost of living crisis went from bad to worse. First-time buyers are especially active, as they are keen to exit the rental market where rents are breathtaking.

“Even though we are likely to get a chunky rate rise this week, for many people it will still be cheaper to own than to rent and that’s driving activity. News that stamp duty is set to be cut is likely to light a match under transaction levels.

“However, if it send prices higher again, this will certainly not help first-time buyers who are already facing rapidly rising mortgage rates and cost of living increases. Get it right however, and in the medium to long term we may just see a market with more transactions rather than one where stamp duty acts as a further disincentive to move.”

CEO of Access FS, Karl Wilkinson, added: “While the summer months always tend to be buoyant, people’s appetite to buy property shows no sign of dipping. Ultimately there are still more people wanting to buy property than there are properties to buy, so by the laws of supply and demand, this situation will continue until the supply side eases.
 
“The new government has so much on its plate at the moment that I expect the housing market is not a huge priority despite rising rents and continuing challenges for first-time buyers.”

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