Official sales figures show UK property market slowing
Mon 21 Jul 2014
Seasonally adjusted estimates for the number of residential property transactions in the UK decreased by 0.2% between May and June, according to the latest figures from HMRC.
Junes sales figure is also 15.7% higher compared to the same month last year while the trend since the beginning of 2013/2014 has been of a general month on month increase in transactions, this halted in February. The HMRC report says that since February there has been a gradual decrease followed by a flattening out of transaction numbers. Recent non-seasonally-adjusted transactions peaked in June 2014 and November 2013 at similar levels, both being the highest levels since November 2007 but it must be remembered that the figures for the two most recent months are provisional and therefore subject to revision.
Peter Rollings, chief executive officer of Marsh & Parsons, pointed out that the figures shows that the UK property market is singing a different tune to that heard at the start of this year. The fierce competition for properties and unprecedented house price growth has subsided as a new wave of supply has come onto the market, stabilising price rises and restoring normality to trading conditions, he said. Both buyers and sellers alike are benefitting from this new calmness in the market, with a greater array of available property to choose from and slightly slower pace of activity making stepping onto the ladder or trading up a less daunting prospect, he explained.
The implementation of tighter lending criteria and affordability checks has lengthened the borrowing process and cooled the market during this transitional phase. This wave of regulatory change will ensure lasting sustainability and responsibility of growth, but the government and the Bank of England need to be careful that future interventions are not premature and overzealous. Beyond the capital, the housing market recovery still requires a watchful eye, he added.
According to Jonathan Hudson of West End estate agent Hudsons Property in London, the property market is cooling but still strong. We are still achieving top prices but some of the urgency has subsided. Certain measures put in place, like the overseas buyers capital gains tax and potential interest rate rises have not really affected the market, he said.
However, tighter lending criteria have slowed increases and buyers are being more considered before offering. This is also allowing more property to reach the market, giving buyers more choice, he added.