Transaction numbers dip for UK but Hampstead is bouncing back

Despite Brexit, stamp duty and slowing sales Hampstead is seeing signs of recovery

Despite Brexit, stamp duty and slowing sales Hampstead is seeing signs of recovery - Credit: Archant

Despite a rollercoaster year and a national dip in transactions Hampstead estate agents are reporting the return of big deals

The number of UK residential properties that transacted was down 3.3 per cent in June from May.

Seasonally adjusted figures show 96,910 properties changed hands last month, the lowest number since October 2016 according to HM Revenue and Customs (HMRC).

HMRC warned against drawing a direct comparison with June 2016, when the introduction of a 3 per cent surcharge on second homes in April that year caused a spike in transactions for March, followed by a sharp drop (Fig. 1).

The Bank of England announced intentions to curb buy-to-let mortgages around that time, and the referendum result last June further impacted the market.

Sales volume data for June 2017 has yet to be released for Camden, but the figures for March show that 172 properties transacted that month.

In March 2016 396 properties were sold ahead of the changes to stamp duty, dropping to 114 in May, representing the lowest sales volumes since the 2008 financial crisis (Fig. 2).

The stamp duty surcharge and the Brexit vote compounded problems for the north London market, which had been slowing since the introduction of a new system of stamp duty land tax in December 2014.

It’s been a rollercoaster few years for local agents, who have been encouraging their vendors to adapt to the prevailing buyers market by lowering their asking prices or pricing reasonably to begin with.

Finally it appears that the market may be moving again, albeit in a hyper local part of north London.

“We’ve done well, particularly in the Hampstead market. We’ve sold six pretty substantial houses in the last six weeks,” said Philip Green, director of Goldschmidt and Howland. “It’s weird, because in general transactions are low.”

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Despite higher levels of stamp duty they’ve exchanged on properties in the £4 million to £8 million bracket.

Last week James Griver of TK International reported an un-modernised garden flat in Hampstead had sold for £1,600 per sq ft.

Trevor Abrahmsohn, director of Glentree, said he had had “more interest in the past two months than in the last two years.”

It’s not the best time for sellers looking to achieve the best price, but those motivated by the so-called ‘Three D’s’ – debt, death and divorce – along with some top of the range new builds coming to market means that the buyers market is booming.

“I think it’s a great time to buy,” said Mr Green. “Prices are a bit lower than they were and if you’re in for the long haul there are some really great opportunities out there. It’s definitely not all doom and gloom.”

The halcyon days of easy money for estate agents are well and truly over for now though.

“We’re working extremely hard, probably harder than we’ve worked in a long time because in this market buyers don’t just wander in through the door.”