The first figures following the introduction of the stamp duty surcharge for buy-to-let landlords and second homebuyers have been released by Revenue & Customs (HMRC) and they show that the volume of residential property transactions remained broadly unchanged in the second quarter of the year compared with the previous three months, and was up 10% year-on-year.
The provisional non-seasonally adjusted residential property transaction count for Q2 of the year was 208,000 liable and 63,400 non-liable sales, up by 1% on Q1 2016 and 10% higher than Q2 2015.
The estimated stamp duty yield for Q2 2016 was £1.977m from residential transactions and £724m from non-residential transactions, up 13% quarter-on-quarter, and 28% higher than Q2 2015.
The marginal increase in the volume of properties sold was led by sales at the lower-end of the market where momentum is at its highest.
"It may be too early to call but it seems the government's changes aren't off-putting buyers from snapping up those additional properties," said Andrew Bridges, managing director of Stirling Ackroyd.
"It seems buy-to-let investors are still primarily competing with first-time buyers for lower value properties," he added.
But with sales at the top-end of the market looking rather subdued, Bridges has suggested that the government may have to look again at the stamp duty surcharge and assess whether it is helping or hindering the market.
Andrew Lloyd, managing director of Search Acumen, agrees that the government may have "shot itself in the foot" by introducing the surcharge.
"Instead of freeing up the lower-end of the market for first-time buyers as promised by George Osborne, competition for these more affordable properties has intensified and therefore further squeezed out many first-time buyers from getting onto the housing ladder," he said.
Ultimately, the figures show that despite a tumultuous three months in British politics, and the government's decision to penalise those investing in additional properties, the residential and buy-to-let markets have stayed strong, according to Lloyd.
He added: "The second quarter of 2016 saw a 10% jump in residential transactions from the previous year and was the highest recorded figure for this quarter since 2007. Although it may feel as though we are in a time of constant change and uncertainty, we can look ahead with some optimism despite the looming realities of Brexit. The market is fundamentally strong."
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