Housing market: property sales rise in May as HMRC figures reveal 50 per cent drop year-on-year
House sales jumped 16 per cent last month in the latest sign that the property market is surging back to life.
Latest figures from HM Revenue & Customs show that 48,450 homes changed hands in May — the month that the Government ended the lockdown freeze for estate agents.
Volumes were still almost 50 per cent down on the previous year but agents say momentum has been steadily building.
Guy Gittins, managing director of Chestertons estate agents, said: “Property viewings have tripled, while website enquiries, newly registered applicants and offers made on properties have all more than doubled in the 39 days since the market reopened, compared to the 51 days of lockdown prior to May 13. This clearly shows confidence in property has not been shaken by the impact of coronavirus. If sales continue at this rate, supported by low mortgage rates, we could see prices recover a lot quicker than many predicted.
“Although there are no official figures for London our branches have seen a frankly astonishing upsurge in people looking to buy since the market reopened in mid-May.
Andrew Southern, chairman of property developer Southern Grove, said :“The level of transactions still looks decidedly muted but a 16 per cent monthly increase is actually relatively good.
“The HMRC figures to watch will come much later, in the autumn, when they will reflect the post-lockdown activity of May and June. But housebuilders are likely to have read the signals by then and begun investing in their pipeline with a degree of confidence again. The fundamentals of this market haven’t changed.”
Tom Bill, Head of UK Residential Research at Knight Frank, said: “The pipeline of deals under way when the lockdown began largely held together and accounted for the majority of transactions in April. After the market reopened in May, deal activity picked up and today’s figures demonstrate how transactions have now bottomed out.
“Since the market reopened, there has been a dramatic but potentially short-lived surge in demand that will be reflected in even higher transaction numbers in coming months.”
Anna Clare Harper, author of Strategic Property Investing and co-founder of property fund Anglo Residential, said: “Recent events and practical restrictions, such as physical valuations and obtaining finance, mean it is hardly a surprise that property transactions have fallen dramatically year on year.
“However, what we can see from the HMRC data and from what we are hearing from investors, appetite is responding quickly. We are seeing the signs of strong appetite to move forward with investments in the UK residential market in particular.”
Jeremy Leaf, north London estate agent and a former Royal Institution of Chartered Surveyors residential chairman, said: “As always, it is property transactions rather than the more volatile prices which prove to be a better barometer of market strength and these are no exception. Although, of course, the numbers represent activity initiated several months ago, so are historically disappointing, they do show as well a welcome enthusiasm to pick up on transactions which were stalled and engage in new deals, which is exactly what we are finding on the ground.
“Looking forward, listings are increasing which is encouraging and likely to bring more balance. But on the other hand, we have concerns that most of the demand is for smaller family houses rather than smaller flats, as aspiring first-time buyers remain concerned over future employment prospects post-furlough.”