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Steady transaction levels will ‘set the tone’ for the year ahead – HMRC

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  • 21/02/2019
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Steady transaction levels will ‘set the tone’ for the year ahead – HMRC
Residential property transactions totaled 101,170 in January, according to the latest data from HM Revenue and Customs (HMRC), an increase of 1.3% year-on-year.

The figure also represents a jump of 0.8% from the transactions in December 2018.

HMRC described the transaction levels seen as “stable”, and noted that year-to-date residential transactions for 2018-19 have been “at similar levels to previous years”.

Mike Scott, chief property analyst at online agent Yopa, suggested that these “stable” results would “set the tone” for the year as a whole.

“This level of activity is consistent with a steady market, neither booming nor crashing, so house prices should continue to rise slowly during the year, roughly in line with wage increases,” he concluded.

Jeremy Leaf, former residential chairman of the Royal Institution of Chartered Surveyors and a north London estate agent, argued that transactions are a better barometer of market sentiment than house prices, and said these numbers reflect what his firm has seen on the ground with cautious buyers and sellers reluctant about cutting asking prices.

He added: “There is no sign of any major corrections in the market, even though sales are harder to negotiate and taking longer to complete. Looking ahead, we do anticipate seeing more signs of release of pent-up demand when hopefully political and economic uncertainty reduces a little.’

More product flexibility

Jonathan Harris, director of Anderson Harris, argued that the market is “holding up remarkably well” given the political turmoil which is affecting the confidence of buyers and sellers alike. He suggested that some resolution to the Brexit question, one way or another, may finally persuade those who have delayed making a decision to go ahead with a purchase or sale.

“On the lending front, Swap rates have dipped on the back of suggestions that interest rates may be held or cut in the event of a no-deal Brexit in order to boost the economy. Lenders are already very competitive on rate so there is not much room for further reductions but we are seeing more flexibility on products instead, which is welcome.”

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