Post-Brexit house transaction dip ‘negligible’, says HMRC

The monthly data, which is based on Stamp Duty Land Tax (SDLT) and Scottish Administration’s Land and Buildings Transactions Tax notifications, showed 109,630 houses changed hands in the UK in August, up 1.8% on July and staying broadly the same year-on-year.

On a seasonally adjusted basis, taking into consideration that summer months are typically busier than winter months, property transactions in August are down 6.1% on last year.

HMRC said the EU Referendum affected transactions but that any changes were “negligible”.

It said: “There has been negligible change in the seasonally adjusted estimate of the number of residential property transactions between July 2016 and August 2016. There has also been negligible change to the number of non-adjusted residential transactions compared to August 2015.”

Lender Northview’s director of sales and distribution Steve Griffiths said the figures meant there has “clearly not been the immediate, dramatic market crash that many predicted following the UK’s vote to leave the EU”.

He said: “Whilst we must wait for the coming months to see the true impact of the Brexit decision on our housing market, demand is still strong and many buyers in particular continue to maintain their interests in securing their next buy-to-let purchase.”

Property surveyor e.surv director Richard Sexton agreed. The figures show the housing market “remains resilient and open for business”, he said.

However, Sexton warned the figures also confirmed an immediate need for more housing.

According to HMRC, March had recorded the highest number of residential transactions in the last ten years. It said this was due to the Stamp Duty changes, which implemented a 3% surcharge on second homes in April.

However, despite the subsequent dip in transactions in April and May, there were still “substantially” more houses being traded in the first half of the year than in the same period last year, the tax office said.

Its figures showed 604,880 houses were transacted in H1 2016, compared with 547,320 in the first half of last year.

Sexton said: “With underlying demand for property showing no signs of abating, the market remains competitive. As a result many buyers are being priced out completely. This situation is clearly not sustainable.”

He added: “The government needs to address this issue sooner rather than later by working in partnership with the industry to build more homes across the country. This commitment to collaboration will be the only way to achieve a resolution to this ongoing problem.”

MPs are currently garnering views on whether the country’s housing industry is able to build more homes in principle.

The government under David Cameron had set itself a target of building one million new homes in England by 2020. Earlier in September new housing minister Gavin Barwell signalled a change in strategy, saying at a conference the government now wants to include rentals in its targets. It had previously missed its yearly target.

According to HMRC, 94,250 houses changed hands in England in August, up from 91,600 in July and virtually the same as the 94,260 bought in August last year (not seasonally adjusted).