The UK residential property market has started 2020 in style. Following a successful 2019, the December general election has given the market an extra boost of confidence which has translated into a three-year high in transactions.
HMRC data shows that January 2020 saw highest number of monthly sales at this time of year since 2017. Overall, the first month of the year saw 102,810 property sales, which represents annual growth of 5.2% - a figure which rises to 12.7% when seasonal adjustments are not taken into account. What’s more, there was also month-on-month growth of 4.1% compared to December 2019.
The data also shows that the number of transactions in January was one of the highest since the 2008 round of banking crisis, with the exception of March 2016 which saw a spike in transactions before the latest Stamp Duty increases.
This surge in transactions was also noticed by Rightmove. The search engine giant reported in February that there are a huge number of buyers around the country looking to purchase a new property – but that there is not nearly enough stock to satisfy the demand.
Rightmove director, Miles Shipside, said: “There is a boom in buyer activity outstripping the rise in the number of new sellers, which we expect to lead to a series of new price records starting next month.”
In actual fact, the latest figures from the Land Registry show that the predicted house price rises are already here.
Property values have risen in every region of the UK for the first time since February 2018, following a return to growth in regions like the North East which had suffered since the 2016 referendum on membership of the European Union. Other regions including Manchester and Birmingham continued to grow as impressively as ever.
According to the data, released by the Office for National Statistics, the average price has risen to more than £250,000 in England – an annual increase of thousands of pounds which reflects once again the impact of political certainty on the housing market.
Furthermore, Bank of England data shows that mortgage approvals rose alongside house prices, with 67,241 being sold in December 2019. This is another high, and you have to go back to July 2017 to find a similar high.
Political certainty restored confidence to the UK housing market and turned what is traditionally one of the quieter months for the housing market into one of the busiest for years. While it is important to avoid being overconfident, 2020 has begun in a positive fashion and both homebuyers and investors have a lot to look forward to in the coming months.
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