Just a month after DailyInvestNews asked the question Is the UK Housing Boom Over? we may have our answer.
Official data released on Tuesday showed that UK home sales plunged by 63% in July as activity in the market cooled following a dash to meet the deadline for the easing of a stamp duty holiday.
According to HM Revenue and Customs, 73,740 homes were sold on a seasonally adjusted basis last month. July’s figure was 63% fewer than in June when homebuyers rushed to complete sales before a COVID emergency tax break was reduced. July’s figure was still more than 4% higher than in July 2020. However, UK home Sales were down 24% compared with July 2019, before the coronavirus pandemic hit the UK.
The Easing of the Stamp Duty Holiday
Without doubt, the easing of the stamp duty holiday will cool the UK housing market already slowing down since June’s scramble in the housing market.
The stamp duty holiday announced last summer helped boost activity at a time when many people made the move from large city’s and towns in the search for larger living space. The dash for properties saw UK Property Sales Hit a Record High in July,
The stamp duty holiday meant buyers would not have to pay any stamp duty on properties worth up to £500,000.
The tax break is now winding down with the threshold reduced to £250,000 at the end of June. The stamp duty will return to its regular level of £125,000 by the end of September.
HMRC noted that “an expected but noticeable decrease has been observed” after the June deadline for the stamp duty holiday.
