House sales 24.1% higher in January than same month a year earlier

The number of UK house sales was nearly a quarter higher in January than in the same month a year earlier, figures from HM Revenue and Customs (HMRC) show.

Some 121,640 residential property transactions were recorded – marking a 24.1% increase on January 2020 but 2.4% down on December 2020.

However, despite recent surges in transactions as buyers rush to meet a stamp duty holiday deadline in March 2021, the market is still playing catch-up compared with previous years.

HMRC said that, looking at the financial year 2020/21 so far, which covers April 2020 to January 2021, transactions were at their lowest since the same period in 2012/13, when the total was 767,420.

Around 867,970 sales have taken place so far in 2020/21, compared with 978,530 during the same period a year earlier.

HMRC warned that its latest figures are based on incomplete data as not all stamp duty returns had been completed when the figures were compiled. It expects to make revisions in the coming months.

The housing market was effectively shut down for a period at the start of the coronavirus pandemic, but a temporary stamp duty cut in July and the reopening of the market have pushed up demand.

The stamp duty holiday, which applies in England and Northern Ireland and increased the “nil rate” band to £500,000, is due to end on March 31. Wales and Scotland have similar temporary holidays on their property taxes.

Gareth Lewis, commercial director of property lender MT Finance, said: “While the (stamp duty) saving is attractive, trying to move with social distancing, and home schooling, to contend with is not.”

Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said: “Renewed home-buyer and seller activity in the last few weeks seems to be directly related to the vaccine rollout and potential easing of lockdown.”

Anna Clare Harper, chief executive of asset manager SPI Capital, said: “Challenging economic conditions make potential home-buyers less willing and able to buy.”

Jonathan Hopper, chief executive of buying agent Garrington Property Finders, said: “The number of completed transactions eased off a touch compared to December, and the lag effect of the current lockdown – which has squeezed the number of new sales being agreed – could drag down the number of completions in coming months.

“Pushing against that is the large number of transactions still in the pipeline, in which buyers are racing to complete in the final weeks before stamp duty rates rise at the end of March.

“The February and March data will likely see a sprint finish of transactions, so the true test of the market’s momentum will start in April.”