When comparing the three months of Sep – Nov 2010 with the same three months in 2009 there has been a 13% fall in the number of properties sold across England and Wales. However, the figures are slightly distorted due to the stamp duty holiday throughout 2009 and also the available figures have not been seasonally adjusted.
We could, however, see an increase in transactions during the lead up to April 2011 as a 1% increase on stamp duty for properties priced in excess of £1 million is due to take effect from 6th April. Sales could rebound more than is the norm for March and this could also have an impact on later reports.
David Brown, commercial director of LSL Property Services, comments: "Concerns over the direction of the economy, and the ongoing difficulties in obtaining mortgage finance continue to take their toll on house prices. However, the good news is that downwards pressure eased in January, and we are not seeing anywhere like the price reductions we saw at the height of the last sustained fall in 2009. Prices are being cushioned by continued demand from cash-rich buyers, as well as slight reduction in the supply of properties hitting the market. We should see a bubble of increased activity at the top end of the market in the next couple of months as buyers look to hurry through purchases of properties worth more than £1 million before the stamp duty hike in April. On top of this, a growing number of rich investors are withdrawing money from destabilising countries, and investing in bricks and mortar in prime locations in London. However, transaction levels across the rest of the market are still being suppressed by the lack of high LTV mortgages available for first-time buyers. At a time when wage inflation is being outstripped by inflation, would-be buyer finances are under increasing financial pressure and providing the large deposits required by lenders is unachievable for thousands of potential first-timers.”
Housing Transactions by Region; England & Wales
Sales per year 15 Yr Average 1995-2009 Current Oct 2009 – Sep 2010 % Current / Long term
East Anglia 50,495 35,236 70%
South West 116,982 81,583 70%
South East 263,192 178,447 68%
Greater London 146,787 95,614 65%
East Midlands 89,915 56,981 63%
Wales 50,138 31,694 63%
West Midlands 95,925 57,478 60%
Yorks & Humber 98,805 58,204 59%
North 57,393 32,869 57%
North West 122,225 67,606 55%
Total 1,091,857 695,712 64%
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