House sales jumped by 31.5% annually in December – HMRC figures

PA

House sales jumped by nearly a third in December 2020 compared with a year earlier, HM Revenue and Customs (HMRC) figures show.

An estimated 129,400 house sales were recorded in December 2020 – which was nearly a third (31.5%) higher than December 2019 and 13.1% higher than in November 2020.

It marked the strongest month of December for house sales seen in the past decade and the first time since 2015 that house sales have topped 100,000 in December.

HMRC said the jump is likely to reflect the continued release of pent-up demand within the property market since the start of the coronavirus lockdowns in March, alongside a temporary stamp duty holiday.

Between April and December 2020, 750,540 sales are estimated to have taken place, which is still lower overall than the 880,580 sales recorded in the same period a year earlier.

Anna Clare Harper, chief executive of asset manager SPI Capital, said: “These figures represent recovery rather than boom.”

She added: “Transactions have been dominated by second-time buyers, typically trading up to improve their surroundings, rather than first-time buyers getting a foot on the ladder.”

Mike Scott, chief analyst at estate agency Yopa, said: “This is a good result, since the housing market was effectively closed from late March to mid-May, and means that there was a considerable amount of catch-up in the second half of the year.”

House sales plunged by around 50% in April and May 2020 compared with April and May 2019, caused by the economic impacts relating to the coronavirus pandemic and public health restrictions introduced by the UK Government, the report said.

But following the substantial decreases in April and May 2020, house sales have been climbing each month, reflecting the relaxing of coronavirus public health restrictions for the property market during the summer and autumn of 2020 and the introduction of property tax holidays.

Stamp duty applies in England and Northern Ireland, and similar holidays were introduced for the equivalent property taxes in Scotland and Wales.

The stamp duty holiday is due to end on March 31 2021.

HMRC advised caution when interpreting its provisional figures, as estimates for the latest month are based upon incomplete data.

Not all completed stamp duty returns from completed transactions during that month were received when the figures were compiled, it said. Revisions are therefore expected in future months.

Kevin Roberts, director, Legal & General Mortgage Club, said: “The stamp duty deadline is drawing ever closer and buyers now have just over two months to complete on their property purchase.”

Sam Mitchell, chief executive of online estate agent Strike, said: “2020 taught us to expect the unexpected, and that definitely rings true for the UK property market.”