But house prices still climbing 9.2% according to Halifax
The number of house sales in April 2016 fell 45% after the buy-to-let rush in March to beat the 2nd property stamp duty tax. However house price are still climbing due to lack of supply according to the Halifax.
Between March and April, property prices across the UK increased by 0.6 per cent, to an average of £213,472, Halifax said.
Martin Ellis, a housing economist at Halifax, said: ‘Low interest rates, increasing employment and rising real earnings, continue to support housing demand.
‘The strength of demand, combined with very low supply, is causing house prices to rise at a brisk pace in quarterly and annual terms’.
He added: ‘Increasing affordability issues, caused by a sustained period of higher-than-earnings house price growth, should curb housing demand and result in some slowdown in house price growth as the year progresses.’
In April, the number of homes being sold fell by 45 per cent from 153,700 in March to 84,300 in April, the lowest since March 2013.
The slowdown in sales can, according to Halifax, in part be attributed to a flurry of buy-to-let investors rushing to snap up properties before stamp duty hikes in April.
With demand for homes remaining high, supplies remain ‘very low’, Halifax said. New instructions by sellers fell for the second month in a row.
The number of new homes being built was 8.6 per cent lower in April than at the same point a year earlier.
High demand and short supplies have been pushing up the cost per square meter of properties across the country, the data suggests.
Jeremy Leaf, a former RICS chairman and north London estate agent, says: ’It is encouraging for the longer-term health of the market that property prices haven’t dropped substantially following the introduction of the stamp duty surcharge for landlords and second homeowners at the beginning of April.
‘But it is clear that house prices are being underpinned by a shortage of stock and substantial reduction in transaction volumes.
‘However, with the EU Referendum looming on the near horizon it is probably a little early to make too broad a judgement on these figures. Once the vote is out of the way and the result is in, hopefully the market will settle down again very soon after.
‘At the moment the uncertainty means people are holding off making decisions – who is going to decide to buy a property if they don’t know whether they are going to get that pay rise or even be laid off, depending on the outcome of the Referendum?’