The UK housing market picked up slightly last month, with the number of property transactions rising by just over 1,000.
According to figures from HM Revenue and Customs, the number of residential property transactions increased by 1.3% in July to 104,760.
Sales were 8.3% higher compared with the same time last year, although HMRC advised caution when making comparisons as some homebuyers may have changed their behaviour due to the EU referendum.
Jeremy Duncombe, director at Legal & General Mortgage Club, said: “With a lack of new stock coming onto the market, property transactions have remained flat for quite some time now. The Lloyds Homemover report published yesterday revealed homemovers now account for just over half of the housing market, compared to 64% a decade ago.
“Rather than selling their house, families are deciding to stay put in their current homes and paired with today’s result, this highlights the effect that a chronic lack of housing is having on the UK’s housing market.”
UK house price growth has come to a standstill, driven by record low stock numbers and political uncertainty.
The Royal Institution of Chartered Surveyors has reported a slowdown in the housing market, largely a result of a decline in London and the South East dragging down prices.
The failure to build enough new homes over the past 30 years has resulted in a chronic shortage of supply, keeping prices artificially high.
“The UK property market is unlikely to grind to a halt, as low interest rates continue to keep demand high, but ultimately the Government needs to address the ongoing issue of supply,” said Duncombe.
“We need a long-term solution by building more homes allowing a greater number of affordable properties to come onto the market. This will not only provide more choice for second and last-time buyers, but also free up additional housing stock for first-time buyers to secure homeownership,” he added.
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said the figures provided a better indicator on the health of the housing market than other indices such as prices, which can boom and bust.
“While the seasonally-adjusted HMRC numbers are nothing to get particularly excited about, they do show a relatively stable market and reflect what we are seeing on the ground. Realistic buyers and sellers are getting on with moving and were doing so even at a time when things were relatively uncertain because of the general election.
“The figures compared with last year are misleading, however, because this time last year the market was in the doldrums following the imposition of the stamp duty surcharge.
“Looking forward we are expecting more of the same with buyers and sellers negotiating hard to get sales through. Those who aren’t prepared to see the reality of the present market will be left behind.”
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