A total of 105,940 property transactions took place in January as the market recorded a 2.8% month-on-month drop, the latest figures from HMRC have shown.
On an annual basis this month’s seasonally adjusted figure is 9.7% higher when compared with January 2015 (96,600).
For January 2016 the number of non-adjusted residential transactions was 27.5% lower compared with December 2015.
Adrian Whittaker, sales director, New Street Mortgages, said: “Property transactions have seen a marginal decrease in January as a result of limited housing supply, and many buyers are now finding themselves in a bidding war against a significant number of competitors.
“For those fortunate enough to secure a property, the speed of processing a mortgage application can make all the difference.”
Andrew Bridges, managing director of Stirling Ackroyd, said London was a case in point when it comes to problems with supply.
He said: “London’s property market has gallons of untapped potential. Yet a lack of supply is pushing people to stay put for longer, reducing the flow of homes onto the market. London’s rising population will only worsen this supply shortfall.
“And this rising tide of people is coupled with shrinking households, alongside ageing housing stock that no longer matches up with modern life. Our research shows that fewer people are living in London’s homes – the average household is likely to include just 2.3 people per home by 2020.
“This means even more homes are needed on the market. New builds are a crucial component of this. But refurbishment, renewal and motion matter too. The property market must keep people moving, downsizing and relocating.
“Escalating stamp duty charges are largely responsible for this slowdown – deterring people from a change of scenery. These charges now apply to nearly every residential transaction in London. So new measures or more effort from the government are needed to encourage moving – and wake the London property market out of its current slumber.”
