HMRC’s provisional non-seasonally adjusted estimate for UK residential transactions in April 2021 was 111,260, the highest total in April since 2007, when transactions were 126,450.
However, this is a drop from the March 2021 figure of 190,980.
Provisional non-seasonally adjusted UK residential transactions in April 2021 increased 197.8% year-on-year, but a substantial amount of this difference is due to the impacts of the COVID-19 pandemic on the April 2020 statistics.
In addition, the non-seasonally adjusted estimate of 392,170 for UK residential transactions during quarter one of 2021 was the highest Q1 total since the introduction of stamp duty statistics in their current format in 2005, and the highest quarterly total since Q2 2006 (419,270).
Due to the pandemic, quarter two of 2020 was the lowest quarterly total for UK residential transactions since Q1 2009.
Provisional estimates of UK residential transactions in April 2021 have shown an impact from the temporarily increased nil rate bands for stamp duty and and Land Transaction Tax (LTT).
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Following year-on-year decreases in April and May 2020 of around 50%, caused by the pandemic, non-seasonally adjusted UK residential transactions have gradually increased, peaking in March 2021 with a provisional estimate of 173,410.
For non-residential transactions, non-seasonally figures in April 2021 increased 94.4% year-on-year, but again this will largely be due to the effects of the pandemic on last year’s data.
Provisional estimates of UK non-residential transactions in April 2021, 10,520 non-seasonally adjusted and 10,160 seasonally adjusted, are similar to levels reported during April in recent years, excluding 2020.
Following yearly decreases in April and May 2020 of around 45% caused by economic effects around the pandemic, non-residential transactions have followed a generally increasing trend during subsequent months.
Joshua Elash said: “Transactions are significantly down from March due to a large number of purchases completing that month in anticipation of the stamp duty holiday expiring.
“It evidences how significant an impact the scheme is having on buyer appetite and confidence.
“April was always going to be softer in terms of number of transactions.
“The annual rebound has, however, been stunning.
“A year ago, the first lockdown bit into the property market hard, and this comeback is nothing short of astonishing.
“All in all, the data continues to support a growing argument that stamp duty should be abolished completely so as to continue to encourage transactions, upward mobility, and to support the economy.”
Mark Harris said: “April’s dip in transactions compared with March is likely to be at least partly due to the anticipated end of the stamp duty holiday, before its extension was announced, which resulted in buyers taking their foot off the gas to get deals done.
“Now that the holiday has been extended, activity has picked up again.
“Compared with April last year, when the housing market was closed to business thanks to the pandemic, there has been a massive 179.5% jump in transactions.
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“That reflects the grinding to a halt of the market, as well as the surge in demand created by COVID, with more people bringing forward moves to the country and a growing desire for more space, both inside and out.
“On the lending front, lenders have plenty of cash and are keen to lend.
“There are some very competitive products, and with Nationwide returning to 95% LTV mortgages at lower rates than its competitors, it is a good time to borrow.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: “Although these figures reflect many sales agreed several months ago, they show a reduction in activity as many buyers did not expect to still take advantage of the stamp duty holiday.
“However, activity has picked up strongly since the deadline was extended, allowing many to continue where they left off, as well as encourage new entrants to the market.
“Transactions are always a better measure of housing market strength than prices which tend to fluctuate.
“On the ground, supply is still a problem even though listings have improved as rollout of the second jab in particular is encouraging sellers to make their properties available.
“It is not only some sellers who are trying to profit from the home buying frenzy but certain solicitors are charging exorbitant fees to take on work, whereas others are working evenings and weekends to make sure they get over the line in time.”
By Jessica Bird
Source: Mortgage Introducer
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