How is the property market performing following the stamp duty hike? How long are transactions taking and what is demand and supply like? Stephen Ward offers an insight from the conveyancers’ perspective
If some commentators are to be believed, the housing market is currently in the throes of a post stamp duty slump.
Following the rush to complete before 1 April, when the thresholds at which the tax has to be paid on a property sale were lowered, activity has predictably slowed down.
The good news is it looks like it’s already picking up.
The findings of the Council for Licensed Conveyancer’s (CLC’s) latest Quarterly Confidence Tracker, an initiative launched at the start of this year to gauge the state of the home buying and selling market, show conveyancers’ confidence in the market has grown, even in the last three months, although there is still more work to be done.
Home buyers give a vote of confidence
Our tracker ran for two weeks and garnered the views of nearly 150 conveyancers, with almost three quarters (72%) confident in the market’s stability, an increase of 17% from the previous quarter.
Those surveyed also reported a confidence boost amongst buyers – up from 29% to 46% – perhaps because the vast majority of transactions that were expected to complete before the stamp duty deadline did so. This is particularly impressive when you consider that March saw a 104% increase in the number of property transactions compared to the same month last year according to figures from HMRC.
Most transactions are still taking three to four months to complete from the point of an offer being accepted, but there are signs that the process is speeding up and becoming more efficient and this will only increase as improvements continue, especially with bodies like the Digital Property Market Steering Group working hard behind the scenes to effect change.
Buyers and sellers – what’s the state of play?
Demand from buyers fell in March according to the latest RICS UK Residential Property Survey, which is somewhat predictable given that would have been too late to take advantage of the stamp duty break.
The biggest change for those purchasing property now is that they could be hit with a heftier tax bill, with the thresholds at which stamp duty must be paid falling from £425,000 to £300,000 for first time buyers and from £250,000 to £125,000 for non-first time buyers.
Activity is expected to pick up as we move into summer, however. Whilst house prices continue to rise, with HM Land Registry putting the average house price at £280,000, for those not on a fixed rate mortgage interest rates have fallen slightly. Statistics also suggest there is more choice, with Rightmove reporting the number of homes for sale has hit a 10-year high and Zoopla that it is up 11% on last year.
Whether you are buying or selling, finding the right conveyancer who can talk you through the process is key.
Most importantly, you should ensure that they are regulated – our practices, for example, should have a secure badge displayed in a prominent position on their website which, when clicked on, will take you through to more information about them on the CLC’s website.
You can also find a list of CLC-licensed conveyancers by clicking here.
Stephen Ward is director of strategy and external relations at the Council for Licensed Conveyancers
