HM Revenue & Customs has reported that its provisional seasonally adjusted UK property transaction count for September 2016 was 93,130 residential and 9,670 non-residential transactions.
The seasonally adjusted estimate of the number of residential property transactions decreased by 4.3% between August 2016 and September 2016. This month’s seasonally adjusted figure is 11.3% lower compared with the same month last year. Chart 1A shows the historic time series for residential property transactions.
HMRC said the large increase in transactions for March 2016 followed by the substantial reduction in April is likely to be associated with the introduction of the higher rates on additional properties in April 2016. However, whilst April and May 2016 are lower than the corresponding months in 2015, HMRC said it should be noted that the total for Quarter 1 to Quarter 2 of 2016 is still substantially higher than the corresponding period last year.
The additional property rates were announced in the Autumn Statement 2015 for England, Wales and Northern Ireland, and in the Scottish Government’s draft 2016-17 budget for Scotland. Non-tax factors may have played a role as well, for example the Bank of England’s plans to curb Buy-to-Let mortgages resulting in a rush to purchase before April 2016, and the EU Referendum affecting transactions in recent months. The residential count includes properties paying the main and additional rates.
For September 2016 the number of non-adjusted residential transactions was about 5.7% lower compared with August 2016. The number of non-adjusted residential transactions was 5.3% lower than in September 2015.
Jeremy Duncombe, director of Legal & General Mortgage Club, said: “The market has obviously experienced a great deal of fluctuation and uncertainty over recent months – and today’s figures showing a decrease in transactions add to this tumultuous picture.
“However, it is important not to be distracted from the critical issue: a supply and demand crisis that is plaguing the housing market. Today marks 100 days since the new Prime Minister took office. It’s high time, as we approach the Autumn Statement, that the government ends years of procrastination over our housing market and embarks on a radical construction programme that will see our children and grandchildren have the best opportunity to make their first step onto the property ladder.”