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Government figures show that, totalling 98,000, residential transactions in the UK during August 2021 were 20.8% higher than in August 2020.

On a monthly basis, transactions of this type increased by 32%, the data adds.

It also shows that non-residential transactions, at 10,250, grew by 28.2% on a yearly basis in August – 5.8% when measured monthly.

This comes after HMRC reported transaction numbers slipping by almost 63% on a monthly basis in July.

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John Phillips says: “Property transactions are returning to a more recognisable level.

“The peaks and troughs of the past few months have been more erratic than in the past, but these should begin to level out as we move away from the stamp duty holiday.

“One thing that the latest data proves is that the tax savings were not the sole driving force behind the vast majority of moves.”

He adds: “Despite the end to furlough in a few weeks, vacancies have exceeded 1m for the first-time, so there are jobs out there, and the number of buyers is unlikely to fall significantly.

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“Confidence in the economy is growing and people are now switching jobs, so this may test lenders criteria on probationary periods, but it is unlikely to be a significant blocker for many.”

And Anna Clare Harper looks abroad in her commentary: “The Evergrande crisis highlights how over-leveraging can bring investors and homeowners down. Regardless of transactions data, prices can go down as well as up. A big cause of this is lending; just because you can borrow to acquire property with low deposits, it doesn’t mean you should. Buyers must remember that both capital and interest repayments must be paid.

“The good news for UK house buyers lies in a key difference between the Chinese property market and the UK property market: supply constraints. In the UK, we suffer an ongoing shortage of housing stock, which in turn means prices are expected to continue to grow.

“For this reason, although Evergrande is terrifying, and UK transactions rising and falling by 32% in a month seems volatile, the UK market is likely to remain more measured in its fluctuations,” Harper concludes.

By Gary Adams

Source: Mortgage Finance Gazette

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