UK Property Sales Fall Once Again

by Mark Johnston

The brief flurry of activity in the property market has come to an end, due to the end of the stamp duty holiday for first time buyers.

There is generally a rise in sales in the spring as warmer weather seems to encourage some potential buyers to go house hunting.

However, according to tax authority figures the sales of homes in the UK has failed to stay on a spring high in April.

The figures from HM Revenue and Customs (HMRC) showed that approximately 65,000 homes were sold in April 2012, 4,000 fewer than the same month a year earlier and a sharp drop from 88,000 in March 2012.

A survey of estate agents conducted by the Royal Institution of Chartered Surveyors (RICS) showed that sales fell in April, for the first time since last September.

Separate figures from HM Revenue and Customs (HMRC) also showed a big fall in the number of properties changing hands in April 2012 after transactions reached a recent peak in March 2012.

Transactions still remain well down on their 2006 levels when between 130,000 and 150,000 homes were sold every month.

Figures from the Office for National Statistics (ONS) house price index, which have taken over from the Department for Communities and Local Government (DCLG) index, have also shown that house prices fell by 0.6% in March.

The average price of aUKproperty is now around £225,283, but first time buyers have still found themselves paying 2.8% more than in March 2011.

Both the Halifax bank and the Nationwide building society have also reported price dips in April.

Peter Bolton King, housing spokesman for the Royal Institution of Chartered Surveyors (RICS), said “it is unsurprising to see that prices across much of the country are continuing to fall”.

Howard archer, chiefUKeconomist at HIS Global Insight, also added that the overall drop in prices tied in with his view that “house prices would trend gradually downwards in 2012”.

Henry Pryor, an estate agent, said that “sellers still need to be realistic on price in the current climate as selling has never been tougher”.

Many potential buyers have now learnt that an asking price is not necessarily a guide to current value, which means they are much more ‘clued up’ when it comes to actually making offers.

Housing market activity is very low compared to long term norms and the economic fundamentals currently look worrying overall with unemployment high and earnings growth muted.

Euro zone developments are also factor in house sales at the moment as they are highly uncertain and have the potential to undermineUKeconomic prospects and conditions in the housing and mortgage markets.

This has become apparent recently as lenders tighten their lending criteria’s and raise their rates.

The Bank of England has reported that the number of mortgages approved in both February and March were down from January.

Many mortgage experts believe that the scarce supply of easily available mortgages is still one of the biggest influences on the housing market.

 

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