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Property transactions remain stagnant

The number of residential property transactions in the UK in December decreased on a monthly basis but it experienced a mild increase year-on-year, official data has shown.

The provisional UK property transaction count for December 2018, for properties above £40,000, was 102,330, according to the latest report from HM Revenue and Customs.

This meant transactions were down 0.1 per cent on November but they were up 3.6 per cent when compared with December 2017, when it was 98,760 transactions.

Kevin Roberts, director at Legal & General Mortgage Club, said: “The mortgage market is offering more choice and flexibility than ever before; however, transaction levels continue to tell the same story of stagnation.

“Political uncertainty, the cost of moving and barriers such as stamp duty are leading some homeowners to ‘improve, not move.’

“The government’s extension of the Help to Buy scheme and a stamp duty exemption to shared ownership properties will help those further down the ladder, yet there is more work to be done.

“Extending this break to last-time buyers would free up larger properties for growing families, enabling the next generation of homebuyers to step onto or even up the property ladder.”

Data released last week showed first-time buyers and remortgages continued to drive the UK housing market towards the end of 2018, as homeowners benefitted from competitive deals and housing schemes.

More than 35,000 new first-time buyer mortgages completed in November 2018, up 5.8 per cent when compared with the same month in 2017 and at a value of £6bn, according to UK Finance’s November Trends update.

But UK Finance also found the buy-to-let market had seen 9 per cent fewer new home purchase mortgages in November 2018 than it did a year earlier, while remortgages in this sector increased by 9.5 per cent.

The Help to Buy scheme was launched in 2013 and is available for new build properties, offering a government loan of up to 20 per cent of the home’s value.

In the October budget Chancellor Philip Hammond confirmed the Help to Buy Equity Loan scheme would be extended until 2023 from its previous 2021 deadline.

The HMRC data meanwhile showed the number of non-residential property transactions increased by 5.5 per cent between November 2018 and December 2018.

This figure was 5.4 per cent higher than in the same month last year.

Source: FT Adviser