House sales rise as stamp duty deadline looms
Housing transactions increased by 13% in February as first-time buyers rushed to beat the stamp duty holiday deadline, according to Acadametrics.
The data provider's latest house price index says the increase marks a 10% uplift from the usual rise seen in February. Around 52,000 properties were sold over the month, an increase of 21% from February 2011.
Chancellor George Osborne's stamp duty holiday for first-time buyers purchasing properties that cost less than £250,000 is scheduled to end on 24 March. The data provider also cites "increasing confidence" from lenders as a reason for the rise in transactions.
House price rises
In addition, Acadametrics reports that the average property value rose by £500 in February, marking a month-on-month rise of 0.2%. The average house now costs £219,844. On an annual basis however, prices are down by 1.8%.
The housing expert also notes that regional price disparities are widening, with the London area remaining "in a league of its own".
Richard Sexton, director of e.surv, comments that without London, "the national picture would look far gloomier"; with Wales the only other region that has seen price rises over the past year.
Dr Peter Williams, chairman of Acadametrics, says that from June 2011, prices in Greater London started to rise at a faster rate than in the rest of the country, while values in the North continued to drop.
"By the end of 2011, prices in London had increased by 2.4%, while on average, prices excluding London were down 2.4% and prices in the North had fallen by 6.3%," he says.
"The differences in price movements in these three areas indicate that, underneath a 'stable' market at national level, significant regional variations exist."
This article was written by our sister website Money Observer
A hugely unpopular tax paid on property and share purchases. Stamp duty on property is levied at 1% for purchases over £125,000 (£250,000 for first-time buyers) which then moves up at a tiered rate. For property between £125k and £250k you pay 1%, then 3% from £250k up to £500k and then 4% from £500k to £1m and then 5% for properties over £1m. But unlike income tax, which is “tiered” and different rates kick in at different levels, stamp duty is a “slab” tax where you pay the rate on the whole purchase price of the property. On shares, stamp duty is charged at a flat rate of 0.5% on all share purchases. Figures correct as of May 2011.