The number of residential property transactions decreased by 0.9 per cent between June and July, according to HM Revenue & Customs figures, with this month’s seasonally adjusted total being 8.3 per cent less than the same month last year.
The government’s explanation of recent property trends took in all the oft-cited events this year, including a transaction spike in March and fall in April due to the stamp duty tax hike being brought in, along with the Bank of England’s plans to curb buy-to-let mortgages, adding to a spring rush to purchase.
In fact, this March recorded the highest number of transactions in the last decade.
Of course, the outcome of EU referendum has also had an impact on transactions in recent months, HMRC noted.
For July, the number of non-adjusted residential transactions was about 0.7 per cent higher compared with June.
The number of non-adjusted residential transactions was 13.6 per cent less than in July 2015.
Stephen Smith, director at Legal & General Housing Partnerships, said while there has been a slight fall in transactions this month, it is not possible to pin the blame entirely on the vote to Brexit.
He said: “Though some buyers may have held off on purchasing a property ahead of the referendum, it is important to remember that transactions have remained static for some time now, and that the seasonal lull we typically see over the summer months is also likely to have played a role.”
Meanwhile, the latest analysis from Equifax Touchstone suggested confidence in the property market has waned following the 23 June Brexit vote, with mortgage sales falling 15.7 per cent (£2.5bn) last month, and 16.6 per cent year-on-year (£2.7bn).
Residential mortgage sales fell by 15.8 per cent (£2.1bn) on June, while buy-to-let sales dropped by 15.2 per cent (£400m). Year-on-year residential sales were down 9.7 per cent (£1.2bn), while buy-to-let sales tumbled by 39.1 per cent (£1.5bn).
Every regional area apart from the north west of England (-7.6 per cent) showed a double-digit decline, with Northern Ireland (-28.7 per cent) and Scotland (-21.5 per cent) showing the sharpest falls.
The data, which covers 92 per cent of the intermediated lending market, showed the average value for buy-to-let mortgages was also down year-on-year, falling from £160,203 to £157,195. The average value of residential mortgages in July was £188,053 compared to £186,897 in July 2015.
Equifax Touchstone’s relationship manager Iain Hill said the market has been waiting to see how hard property buyers’ confidence has been hit.
“It’s important to remember that the summer period traditionally brings a dip in mortgage sale volumes during July and August, so it will be many months before the full effect of Brexit is uncovered,” he stated.
“We’re confident that the market will bounce-back longer-term, with negativity likely to be offset by the recent interest rate cut, leading to lower and more competitive rates from lenders.”
