HRMC has revealed that its provisional seasonally adjusted estimate of UK residential transactions in April 2021 is 117,860, 179.5% higher than April 2020 and 35.7% lower than March.
Its provisional seasonally estimate of non-residential transactions in April 2021 is 10,160, 89.0% higher than the same month last year and 11.4% lower than March 2021.
Richard Pike, Phoebus Software sales and marketing director, said: “The numbers today tell quite a story, firstly of shifting stamp duty deadlines and, secondly, the emergence from Covid restrictions. The initial rush to get transactions over the line before 31 March had a huge impact driving transaction numbers up. Whereas, compared to April last year, when the first lockdown had a massive dampening effect, the numbers year on year show the market is thriving
“Despite the rise in property prices reported by the Office for National Statistics (ONS) this week, the appetite in the housing market continues unabated. With just over a month to go until the end of the stamp duty holiday the push to beat another deadline is definitely under way. However, as the deadline approaches and conveyancers are put under pressure, to finalise transactions, the numbers for May and June are likely to mirror those in March.
“The fear was that the market would take a nose-dive at the end of the holiday, but with so many transactions already in the pipeline, that fear could be unfounded. Many people are looking to move away from major towns and cities since the pandemic and the stamp duty holiday may not be the only driver for the current increased demand.”
Dave Harris, CEO of more2life, added: “The announcement of the extension of stamp duty land tax holiday undoubtedly added fuel to the fire that had started to cool due to the prospect of these fees being back on the table imminently. At the same time, the continued success of the UK’s vaccine rollout and the partial reopening of non-essential retail and hospitality will have also boosted consumer confidence and encouraged many buyers to push on with their purchases.
“Some of these transactions have involved older homeowners, with the Stamp Duty break prompting a growing number of over-55s to use equity release to fund a house purchase. At more2life, we have seen the proportion of over-55s using equity release to fund property purchases treble from 5% to 15% in recent months – many benefitting from historically low rates and the option to make interest and capital repayments.
“While the concept of using equity release for house purchase is a fairly simple one, there is an added layer of complexity to the entire transaction which means that it can take longer – especially at a time like this. Advisers need to manage client expectations and work with providers to ensure that information is provided as quickly as possible so they can get as many cases over the line as possible ahead of the June and September deadlines.”
