HMRC December property transaction data

HMRC December property transaction data

Revealing the monthly estimated figures for both residential and non-residential property transactions, HMRC property statistics for December 2016 have recently been released.

Showing data for the UK and its constituent countries, the publication is based on data from both the HMRC’s Stamp Duty Land Tax (SDLT) and the Scottish Administration’s Land and Buildings Transactions Tax (LBTT) databases.

For December 2016, the provisional seasonally adjusted UK property transaction count was 97,250 residential and 10,610 non-residential transactions.

Residential Transactions

On a seasonally adjusted basis, the estimate for the number of residential transactions grew between November 2016 and December 2016 by 0.2%. The seasonally adjusted figure is 8.5% below the level recorded in the same month last year.

The transaction growth during March 2016 followed by the significant drop in April is likely to be related to the higher rate of stamp duty for additional properties, introduced in April 2016. Whilst both April and May 2016 are lower than the same months in the previous year, the total between Quarter 1 and Quarter 2 of 2016 should be acknowledged as is it is significantly higher than the corresponding time frame in 2015.

The number of non-adjusted residential transactions in December was about 5.1% higher than November 2016. Compared with December 2015, the number of non-adjusted residential transactions was 4% lower.

Non-residential Transactions

For non-residential property transactions, the seasonally adjusted estimate grew between November 2016 and December 2016 by 2.8%. Compared with the corresponding month last year, December’s figure is 6.2% higher.

As can be usually expected with the seasonal nature of purchases, non-adjusted transactions have observed peaks and falls on a monthly basis.

Commenting on the figures was Doug Crawford. The CEO of My Home Move highlighted the stability of the market despite referendum induced uncertainty as well as potential challenges for the year ahead.

“2016 was an unusual year for the housing market. A huge amount of transactions were brought forward into the first quarter as a result of the changes to Stamp Duty Land Tax (SDLT) on second properties. Furthermore, an unexpected result in the EU referendum led many buyers to take a cautious approach.

“Despite this, transaction levels have remained stable in the second half of the year, which is a testament to the market’s strong fundamentals. Looking ahead to 2017, buyers’ confidence is likely to grow as the economic picture becomes more stable, which will lead to an increase in activity. Investors will also become used to the regulatory ‘new normal’ and begin to factor policy changes into their planning, which will drive greater volumes in the buy-to-let market than we are currently seeing.

“In the long-term, demand for both rented and owner-occupied accommodation will support  prices and sales volumes. There will undoubtedly be challenges for the market over the next twelve months, with the triggering of Article 50 and changes to landlords’ tax relief looming on the horizon. However, the property market has shown it is more than strong enough to overcome these obstacles.”

Chief Executive of LMS, Andy Knee, also commented on the HMRC statistics, considering that the next few months will test the strength of the housing market.

“Transactions in 2016 hit a ten year high, boosted by a large spike in March ahead of changes to Stamp Duty, introduced in April.

“The forthcoming months will test the strength of the housing market, which has demonstrated remarkable resolve, since the vote to leave the European Union. Record low mortgage rates will not last forever. Borrowing costs will become less affordable, ultimately contributing to a slow-down in activity as buyers adjust. Indeed, LMS data reveals 32% of remortgagors expect a rate rise in 2017.

“LMS data also shows the increase in property transactions last year was matched by an increased level of activity in the remortgage market. Now is the time to remortgage, before rates rise and economic uncertainty heightens after Article 50 is declared.”

Also commenting on the HMRC figures was David Brown, CEO of Marsh & Parsons. He highlighted the market’s resilience as well as the encouraging interest from international buyers in 2017 already.

Despite a number of obstacles in 2016, the total number of transactions rose slightly compared to 2015, to the highest since the financial crash. The resilience demonstrated in the face of a vote to leave the EU and marked changes to Stamp Duty – which significantly impacted sales of second homes and the buy-to-let market – is not to be scoffed at.*

“We’ve already witnessed an encouraging stream of interest from buyers across London during the start of 2017, particularly international buyers who have been buoyed by the falling value of the pound and continue to view London property as a solid investment.”

The statistics can be accessed here.

 

 

Georgia Owen

Georgia is the Content Executive and will be your primary contact when submitting your latest news. While studying for an LLB at the University of Liverpool, Georgia gained experience working within retail, as well as social media management. She later went on to work for a local newspaper, before starting at Today’s Conveyancer.

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