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News on Property Today by Harvey Hancock

House Sales dip in April but HMRC predicts summer recovery

House purchases fell by over 100,000 from March to April this year after the Stamp Duty levy.

Figures from HMRC showed that 173,430 houses were sold in March 2016, and just 70,690 in April.

Sales have since balanced but the lead-up to the EU referendum has stagnated activity, and its outcome will have an effect on activity for the rest of the 2016 - this will likely push down house prices in the short term, regardless of the ongoing supply shortage in the UK.

However, the total number of sales in 2016 is expected to be higher than 2015's figures - up from 1,201,740 sales last year to 1,330,170 in 2016 - indicating that HMRC's extrapolations assume steady sales for the rest of the year.

Given the surge in March, those sales may prop up the total sales figure. Alternatively, HMRC's figures predict a second surge after the uncertainty of the referendum wears off.

Looking at the longer-term increase in sales in the past four years, the predicted total this year will out-perform 2011-12's figures (920,960) by nearly half a million more UK property transactions.

HMRC's findings point out that the annual sales peak usually occurs in the summer months, so a pick-up after the referendum would perhaps be accelerated by the preceding months' inactivity.

Landlords can therefore look to the 'Brexit price trough' as a springboard for making their first purchase since April's stamp duty hike - a lower basic house price means less tax paid on the property. Depending on circumstances, pushing through a deal immediately after the referendum's results could increase capital gains in the long run.

For more information about buy-to-let investments, please contact your local CJ Hole office today.
To see HMRC's full results, please click here.

Harvey Hancock

Harvey is our in-house copywriter. He provides the majority of the news stories that come out of the industry, and also reports on our internal research and news. Please email Harvey.Hancock@propertyfranchise.co.uk with any queries or comments.

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