Slump in monthly housing transactions, Land Registry reports

Latest house transaction data from the Land Registry shows a slump in property sales across England and Wales.

The figures are complete only until the end of last September, but show that from June to September last year, there were an average of 57,971 sales per month.

For the same period the year before, the monthly average was 62,006.

Last September itself there were only 50,517 house sales, against 63,552 for September 2011 – a fall of 21%. Sales in every price bracket were down.

In London, housing transactions were also down by 14% from 8,670 in September 2011 to 7,464 last September. Significantly, transactions levels of £1m-£1.5m houses were barely reduced, going from 196 to 192, and the same applied for sales of properties priced between £1.5m and £2m. These went down from 102 to 92. However, £2m-plus properties, affected by hikes in Stamp Duty, fell from 136 to 110.

According to the Land Registry, house prices barely changed in November, going down by just 0.3% to stand at £161,490.

Brian Murphy, head of lending at Mortgage Advice Bureau, said he was optimistic that Land Registry transaction statistics for the rest of last year could show an improvement.

He said: “Purchase mortgage applications were up by 9% year on year in October and up 13% in November, giving a really positive indication of growing demand in the market. In fact, October saw more purchase applications than any other month during 2012, and with healthy competition between lenders, we have every reason to expect this positive trend will continue during 2013.”

However, Robin King, director of property network Move with Us, said: “Over the next 12 months, property transactions are likely to remain subdued at around 575,000 for the whole year, compared to 1.6m in the height of the 2006 property boom.

“We also expect to see the highest ever proportion of new-build transactions compared to second-hand properties.” 
 
“This increase is likely to be a result of incentives offered by developers in what is still a challenging lending market, and the flexibility that larger developers are able to offer.

“For some aspiring home owners, buying a property through the FirstBuy scheme or through part exchange may be their only option when looking to move up the property ladder.”

The Council of Mortgage Lenders is forecasting that there will have been 930,000 transactions last year, and is predicting 950,000 this year.

Meanwhile, Nationwide has come up with the first report for this year, putting house prices at £162,262 in December, a monthly fall of just 0.1%. According to Nationwide, house prices finished last year 1% lower than they started it.

Nationwide economist Robert Gardner warned that house prices are still around 5.1 times earnings, compared with a long-term average of 4.2 times.