U.K. Home Deals Rose 7% in January Year Over Year – Mansion Global

The number of pending contracts for homes in the U.K. was up 7% in January compared to the previous year, according to a Monday report from Rightmove.

In addition, the average listing price of U.K. residences ticked up by 0.5% in January, compared to the previous month, as a shortage of homes for sale continued to drive price growth. New listings dropped 21% last month, compared to 2020, the data showed.

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As well as the current lockdown motivating buyer demand again, the restrictions have also been a factor in limiting new supply, leading to some modest upwards price pressure, Tim Bannister, director of property data at Rightmove, said in the report. These are strong signs that new buyer demand is not facing a cliff-edge after March 31.

That date marks the end of the stamp duty holiday in the U.K. that has saved buyers of homes under 500,000 (US$695,175) from having to pay the levy. For buyers of more expensive homes, the tax break amounts to 15,000 in savings.

It remains to be seen if this momentum will be enough to make up for the removal of the stamp duty savings that are benefitting many buyers and have been adding a sense of urgency to the whole market, Mr. Bannister said.

About 100,000 buyers, or one in five, who agreed to buy a home last summer still have not completed the deal and could lose out on the tax savings, according to the report.

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U.K. Chancellor Rishi Sunak is reportedly considering extending the holiday six weeks, which could mean tax savings on between 120,000 and 160,000 additional transactions, Rightmove said in a separate news release Tuesday.

Sellers who agreed to a sale last year...are now desperately trying to get their deals over the line, Mr. Bannister said. The delays have been a result of the huge number trying to go through, along with the many challenges of the people involved in the process working from home. If there was a six-week extension, it should give the majority of the sales from last year the chance to complete in time.

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U.K. Home Deals Rose 7% in January Year Over Year - Mansion Global