Housing transactions slipped last month as the UK’s stagnant property market shows little sign of picking up, according to a closely-followed report.
Data from HM Revenue and Customs (HMRC) shows that the number of residential property transactions decreased by three per cent between May and June, falling to 96,370.
House sales completions were also 5.7 per cent lower in June this year compared with the same month in 2017.
Kevin Roberts, director, Legal & General Mortgage Club, said: “Overall housing transaction figures are stagnant. 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.”
Roberts added: “The biggest factor is housing supply. The nation simply hasn’t built enough new homes over the last decade to keep up with demand.”
The news comes less than a week after the Office for National Statistics (ONS) house price index showed house price growth in May slowed to its lowest annual rate in nearly five years.
On average, house prices across the UK have risen three per cent in the year to May 2018, falling from 3.5 per cent in April and dropping to the lowest yearly rate of growth since August 2013, according to the ONS.
“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” said Jeremy Leaf, north London estate agent and a former RICS residential chairman.
“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.”
Alex Depledge, chief executive and co-founder of Resi.co.uk, said : “After a slight uptick in transactions in May, a decrease in June will be disappointing for those looking to sell their home. Issues still remain as second time buyers are being hit by high stamp duty costs and are struggling to afford to move, halting growth within the market.”
Source: City A.M.