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Double-digit drop in home sales

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Is concern over Brexit starting to impact the housing market?
Double-digit drop in home sales

Residential property transactions decreased by almost 10% (9.6%) between May and June 9.6%, and by 16.5% compared to June 2018.

According to HMRC there were just 84,490 home transactions last month.

Brexit uncertainty has led to caution among homebuyers and movers, with many staying put and doing home improvements.

Shepherd Ncube, CEO of Springbok Properties, said: “A lull in transactions will come as a cause for concern in what is currently a rather fragile market landscape, however, the broader picture simply doesn’t suggest a market that is on its knees.

“Homebuyer appetite is alive and well and while many may not want to fill up on bread until the main course of Brexit is finally served, we are on course to see a healthy level of properties transact this year regardless.”

A potted history

The fall in transactions starting at the end of 2007 coincided with the housing market slump and financial crisis. Prior to this, transaction counts had risen steadily, peaking in mid-2006.

In December 2009 there was a peak in transactions associated with the end of the SDLT ‘holiday’, during which the lower tax threshold was raised to £175,000.

Another peak in March 2016 was due to the introduction of higher rates on additional properties in April 2016.

Despite those fluctuations, residential transactions have been relatively stable over the previous 10-years, however they are still significantly below pre-credit crunch levels.

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