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With the benefit of hindsight, the UK housing market possibly did not need a stamp duty holiday in July 2020, four months into the pandemic, according to Tom Bill, head of UK residential research at Knight Frank.
He points out that trading activity was strong during successive lockdowns as people reassessed how and where they lived.
Some form of UK-wide support would certainly be welcome now though, given the negative events supressing demand, he added.
Bill said: “We will find out if the government has a plan in the Autumn Statement later this month.
“In the meantime, the number of UK mortgage approvals was more than a third below the five-year average in September and transaction volumes were down by just under a quarter.
“Unlike the early months of Covid or the period following the mini-Budget, there is no single cause of the slowdown. Sentiment has been affected by a series of factors including the financial pain of higher mortgage rates, the Bank of England’s struggle to contain inflation, the impending general election, and uncertainty arising from overseas military conflicts.”
The weak sentiment in the sales market means that some prospective sellers are hesitating and opting to let out their property instead, according to Bill.
Knight Frank’s David Mumby added: “Rents are at record levels but there are certainly signs that the unprecedented growth experienced over the last two years is starting to slow.
“Market shifts that normally take years have been condensed into just a few months, so hopefully a period of relative predictability will now prevail giving tenants and landlords alike more time to make considered plans.”
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