Should vendors be concerned by the recent fall in housing transactions?
Posted on 23 May 2018
Recent data released by HMRC has shown that housing market transactions have fallen in almost all parts of the UK. For once, the data includes Northern Ireland where transactions were down 17.1% between March and April.
England saw a fall in transactions of 13.6%, while Wales dropped 12%. Only Scotland saw an increase in sales between March and April with a rise of 1.9%.
McGuinness Fleck keep detailed figures on our transactions, amongst many other indicators. Having studied our data, we too experienced a small fall in transaction levels, but it is important to look at these figures in context.
The first thing to point out is that the HMRC figures cover Northern Ireland as a whole, whilst McGuinness Fleck mostly sell in Belfast and the surrounding area. It is likely that the HMRC figures would have different transaction figures between Belfast and elsewhere in Northern Ireland were that detail to be available.
McGuinness Fleck had our best ever March in terms of transaction levels in 2018. One of the reasons for this is that our company continues to grow at a steady rate year on year.
We feel that the other reason, which would apply to the market as a whole, is the timing of Easter in 2018. In our experience there was a scramble to get completions done before the Easter holidays began on 30th March. This pushed through many transactions that might otherwise have slid back a week and been included in April’s figures.
Obviously, this is somewhat anecdotal, but we feel that this must at least play some part in the fall in transactions between March and April. We will get more insight into this when examining the year as a whole.
The other comforting factor for us from our own figures is that the number of valuations we carried out in April and May have been exceptionally high. Again, this might be limited only to McGuinness Fleck and Belfast might differ significantly from the rest of Northern Ireland and the UK.
Generally speaking, however, valuations lead to listings which, eventually, lead to transactions, so our figures can be viewed as a positive early indicator for future transaction levels. Again, time will tell.
It should also be remembered that these figures from HMRC refer only to transaction levels, not house prices. Whilst there is a correlation between these two sets of statistics, the relationship is not as simple as a fall in one leading inevitably to a fall in the other.
If you’d be interested in discussing these issues or the Belfast market in general, please do give me a call on +44 (0)28 9068 3020 or firstname.lastname@example.org