The number of UK residential property transactions rose by 9.7 per cent year-on-year in January, fresh figures from HMRC shows.
Last month there were 105,940 residential property transactions, which although on a seasonally adjusted basis dropped 2.8 per cent month-on-month, was notably higher than the same month last year, a sign that while there remains much uncertainty due to existing global economic conditions, the market is now in a much healthier position than in January 2015.
“Strong market conditions prompted a solid annual increase in the number of residential transactions this January, despite the typical monthly fall from December as activity from buyers and sellers tapered off after the end of the year,” said Brian Murphy at MAB.
Andy Sommerville (left), Director of Search Acumen, like many housing commentators, expects to see transactions rise further before April, as the market braces itself for a “buy-to-let surge” ahead of changes to stamp duty.
“The full picture of the Government’s intervention into buy to let is likely to reveal itself at the end of the first quarter,” he said.
“While lack of affordability and housing supply remain a key issue, this month-on-month dip should be seen in the wider context of uncertainty around Brexit and turbulent stock markets at the beginning of the year,” Sommerville added.
The hike in property transactions, a decline in the number of homes coming onto the market, and the announcement of new stamp duty rates for investors in November’s Autumn Statement, have placed upward pressure on house prices, which rose by 2.5 per cent in January, adding more than £4,700 to the average cost of a property, Land Registry figures show.
The annual price change now stands at 7.1 per cent, bringing the average price of a home in England and Wales to £191,812.
Peter Rollings (right), CEO of Marsh & Parsons, commented, “House prices have made quick progress already in 2016, and this will be a pleasant wake-up call for homeowners considering selling in the spring market. First-time buyers and buy-to-let investors are moving at a brisk pace, and while they continue to grossly outnumber properties for sales, house price growth will persist through the wider political uncertainty.”
London is in a whole different league, with property values pushing 14 per cent annual growth, according to the data.
Andrew Bridges, Managing Director of Stirling Ackroyd, said, “Property prices are galloping out the stalls. But it’s essentially a one-horse race in the house price stakes – and London is winning by several lengths.
“Optimism and enthusiasm for an area are positive reasons for house price jumps. But as this race progresses, the going is getting tougher for first time buyers and anyone aiming to move towards the economic gravity of London and the South East. London has always been a city of mismatch – between unaffordable and affordable boroughs. But now higher prices are triumphing across a much wider area, and some buyers are left with fewer options – and less value for their money.
“New homes are the only way to maintain more sustainable price growth – and blinkered planning rules are getting in the way of London’s future.”