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Rise in residential purchases expected again next month

The number of residential property transactions is expected to rise again next month, despite the stamp duty holiday coming to an end, according to Capital Economics.

Research carried out by the economics company appears to indicate that there will be no big fall in the number of these transactions during the fourth quarter of 2021, due to the fact that demand for the available properties remains very high. The company expects that to mitigate against the end of the holiday on stamp duty payments and keep transaction numbers up throughout the last quarter of the year.

The number of residential property transactions reached a peak during June, hitting 198,000, which was when the initial holiday on stamp duty ended. The number of sales that went through that month was well above that of the 100,000 monthly average before Covid-19.

There was a fall in the number of transactions the following month, with July bringing 73,740, but Capital Economics does not expect that to happen in September. A spokesperson for the company told Mortgage Solutions:

“Even when comparing to June 2020, which saw reservations leap after the housing market reopened, homebuilders report that demand took a further step up this June.”

As well as strong demand, the firm also argues that the return of the economy to almost the level it was at before the pandemic will help ensure transaction levels remain high.

Mortgage advisors with the CeMAP qualification will welcome this forecast as high numbers of property transactions means good business for them.

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