The property sales market in the UK was largely unchanged in May with seasonally adjusted transactions up by just 0.8% month on month and 0.5% higher than a year ago, official figures show.
There were 99,590 residential and 10,710 non-residential transactions recorded by HMRC. Non-residential sales were up 2.6% between April 2018 and May 2018 and 1.4% higher year on year.
It is a disappointing set of figures at a time when first time buyers are struggling to get on the market. ‘We’ve yet to see a single month in 2018 with more than 100,000 home sales whereas last year it only dropped this low four times,’ said Nick Chadbourne, chief executive of LMS.
‘Despite the stamp duty cut and slower house price growth, first time buyers are still struggling to get on the property ladder. Saving for a deposit is the most significant hurdle as monthly mortgage repayments are typically cheaper than renting. More needs to be done to help first time buyers to ensure the market gets moving again,’ he added.
Neil Knight, business development director of Spicerhaart Part Exchange and Assisted Move, pointed out that the figures are nowhere near the levels recorded before the credit crunch when the number of transactions had risen constantly over a number of years to reach a peak of around 150,000 per month.
‘We are currently working with a range of housebuilders that have got lots of big developments in the pipeline. The focus on new housing over the past few years with incentives such as Help to Buy is starting to boost the new build sector, and while we are unlikely to hit the Government’s targets, we are at least moving in the right direction, and this should help boost the rest of the property sector too,’ he explained.
A lack of supply is the issue keeping sales down, Kevin Roberts, director of the Legal & General Mortgage Club, believes. ‘Monthly figures continue to fluctuate, but the underlying story is one of diminishing transaction numbers over the last few years. However, until we are consistently building 300,000 new homes per year, the industry needs to knock heads together to think of alternative ways to address the housing crisis,’ he said.
‘One in four housing transactions are funded by the Bank of Mum and Dad that in itself is a sign of a broken market. Not all households are able to rely on the Bank of Mum and Dad for help, and greater innovation in the sector is needed to ensure people aren’t being locked out of home ownership,’ he pointed out.
‘Whether that be creating more intergenerational mortgage products, reassessing eligibility criteria, or finding other forms of saving for a deposit; lenders, housing associations and the Government need to work together to ensure that all those wanting to buy a home are able to do so,’ he added.