Property sales in the UK fell by 3% between May and June on a seasonally adjusted basis and by 5.7% compared with the same period in 2017, according to official figures.
But the non-adjusted data from HMRC shows that residential transactions were 13% higher compared with May 2018 but still lower than June 2017 by 8.8%.
Industry experts say that the figures suggest that the property market is more or less stagnant and confidence may be affected as Brexit is now only eight months away with negotiations appearing to be increasingly erratic.
‘Given escalating Brexit uncertainty and its impact on consumer confidence, it is no great surprise that the housing market has come off the boil this year. Affordability challenges still prevail, with house price inflation continuing to exceed wage inflation, leaving house prices still out of reach for many,’ said John Eastgate, sales and marketing director at OneSavings Bank.
‘However, there may be some cause for optimism with recent mortgage data pointing to an uptick in lending amongst first time buyers, arguably fuelled by Help to Buy, but there is an awful long way to go before buyer activity is back to pre-crash levels,’ he added.
Neil Knight, business development director of Spicerhaart Part Exchange & Assisted Move, believes that the market is being kept going by first time buyers taking advantage of Help to Buy to get on the housing ladder wit new homes.
‘While it is encouraging to see steady growth in the new build sector, if we want to keep the market moving, we need to be looking at building a wider variety of properties and residential developments, so that home movers and downsizers have options too,’ he said.
‘Developers often choose new build schemes aimed at first time buyers because there is no chain, so it is easier to sell the properties and move on. But we work with a number of developers on schemes aimed at different areas of the market, including downsizers, offering part-exchange and assisted move options which eliminates chains and frees builders and developers up to work on their next project,’ he pointed out.
Home owners are more likely to improve than move if they have a choice, according to Kevin Roberts, director of the Legal & General Mortgage Club. ‘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,’ he explained.
‘The biggest factor is housing supply. The nation simply hasn’t built enough new homes over the last decade to keep up with demand. Innovation in the mortgage market and schemes such as Shared Ownership is helping, but if we want to resolve the housing crisis once and for all, we need to meet the target of 300,000 new properties a year,’ he added.
Meanwhile, the latest figures from the Land Registry show that there were 1,701,270 applications dealt with in June, led by the South East with 391,741.
