Transactions in England, Wales and Northern Ireland have fallen by four percent in the third quarter of 2018 compared with the same period in 2017 and now stand at 290,740, according to LCP’s analysis of HMRC’s Quarterly Stamp Duty Land Tax (SDLT) Statistics.
This is an 8.7 percent fall from the same period three years ago.
Tax receipts for Q3 2018 are also down 8.2 percent to £2,392 million on Q3 2017, which is the third consecutive quarterly fall with a combined total of £685 million in lost revenue compared with the first three quarters of 2017.
Higher Rate for Additional Dwellings (HRAD) receipts have fallen by 12.7 percent since Q3 2017 and now stand at £454 million, which is due to a 14.2 percent fall in HRAD transactions in the last year, which now stand at 56,100.
However, HRAD transactions still generated 19 percent of the total tax take.
Naomi Heaton, chief executive of LCP, commented: “The fall in transactions reported by HMRC’s recent SDLT statistics is undoubtedly due to investors withdrawing from the market until they can see some light at the end of the Brexit tunnel. The toxic political climate and stagnating prices have brought ever-growing uncertainty to the residential market following several years of increased taxation.”
58,800 buyers have claimed First Time Buyers’ Relief (FTBR), an initiative designed to help many struggling to get on the housing ladder, amounting to relief of £142 million. This represents a saving for the average purchaser of £2,415 at the crucial time when they are saving for their first deposit. As FTBR was introduced in November 2017, it is not yet possible to anticipate where it will find its level.
Ms Heaton concluded: “HMRC Stamp Duty statistics do not paint a rosy picture of the UK housing market, with neither the buyer nor the Exchequer winning out. Until the government has a clear road map for Brexit we are unlikely to see increasing transactions and therefore increased revenues. Whilst it is highly unlikely that the Government will repeal any of their recent tax increases it certainly does not seem to be the time to implement more.”
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