The UK property market could be suffering a case of de ja vu, as 2016 starts with political uncertainty in the air and a stall in house sales.
The latest figures from HMRC show that the the provisional seasonally adjusted UK property transaction count for January 2016 was 105,940, down 2.8 per cent from the previous month.
While the figure remains 9.7 per cent higher year-on-year, Marsh & Parsons suggests the monthly dip could be a result of renewed uncertainty surrounding the UK referendum in June and the potential for a Brexit – almost exactly a year after the same pattern occurred ahead of the 2015 general election.
Peter Rollings, CEO of Marsh & Parsons, comments: “Sales activity often cools in times of political uncertainty and the London housing market usually bears the brunt of it. First and foremost, foreign investors may be more tentative given this latest turn in events, especially as it follows hot on the heels of higher Stamp Duty for million-pound properties.
“But history shows us that the market recovered quickly from this short-term ambiguity in 2015 and in fact, home sales have really been building momentum over the past year. The property market is chock-a-block with eager buyers, who are being propelled on by cheap mortgage finance and government support schemes. Given the extent of buyer demand, its a great time for existing homeowners to be thinking about their next step up the ladder, which should drive further purchase activity. For investors, the change in Stamp Duty for second homeowners in April will be an incentive to make purchases quickly over the next month. It remains to be seen how much of an impact the EU referendum will have on these current levels of confidence but go or stay, London remains an attractive safe haven in times of uncertainty.”
Author – Dan Johnson
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