Property sales highest since 2004 as buyers rushed to meet stamp duty deadline
Property transactions surged to the highest level since 2004 as buyers rushed to take advantage of the original stamp duty holiday deadline.
There were 190,980 sales last month, according to the latest data from HM Revenue & Customs, double the number of transactions in March 2020 and a 32pc increase on those in February.
It is the highest number reported since July 2004, when annual house price growth was 20.3pc, according to analysis by estate agency Savills.
The surge came as buyers scrambled to meet the original tax break due to end in March, before it was extended that same month in the Budget.
A similar spike was recorded in 2016 when buyers rushed to complete before higher rates of stamp duty were introduced, but transactions in March were still more than 8pc higher than the previous record.
Sarah Coles, of Hargreaves Lansdown, said the stamp duty holiday had a psychological impact “far greater” than its financial one. “It prompts people who had a vague notion about moving some time in the future to firm up their plans and get cracking," she said.
“It also means that once we get past the end of June when more buyers will pay the tax, we could start to see some of the heat coming out of the market.”
Property sales will likely dip this month, according to Lucian Cook of Savills. He added: "We have seen a resurgence in deals being agreed since the stamp duty holiday extension was announced. That suggests we will see a further spikes in June and to a lesser degree in September."
Pushing up prices
Frenzied demand in the run-up to the initial stamp duty deadline also pushed up prices, which increased by an average of 8.6pc over 12 months to hit £250,341 in February.
This was the highest annual growth rate since October 2014, according to the Office for National Statistics.
London continued to lag behind the rest of the country, recording annual price growth of 4.6pc in February compared with 11.9pc in the North West.
Figures are subject to notable revision, as a result of volatile data during the crisis, but they support reports of unprecedented demand and bidding wars witnessed by estate agents in recent months.
More than nine new applicants are currently registering for every property for sale, creating what has been described as the strongest sellers' market in a decade.
Lawrence Bowles, of Savills, said some regions were still reporting shortages of new stock coming to the market, putting upward pressure on values.
"We would expect sustained high levels of growth in next month’s figures, with growth easing off later in the year as Government withdraws support from the housing market and wraps up the furlough scheme," he added.
