HMRC have released new data about UK stamp duty and property transactions
As head of content and marketing here at Oportfolio Mortgages, my job is to keep you, our clients, up to date and informed about the latest market news and trends. I am pleased to report to you in this article some interesting new data released by HMRC around property transactions and UK stamp duty. Let’s take a look at what the data shows.
UK Stamp Duty And Property Transactions Increase
According to the newly released data from HMRC, the provisional seasonally adjusted estimate of the number of UK residential transactions in June 2024 stands at an impressive 91,370. This figure is 8% higher than in June 2023 and represents a marginal decrease (less than 1%) from May 2024. This slight month-on-month decline marks the first since December 2023, highlighting in my eyes the overall strength and resilience of the UK property market. In this blog I am going to run through the most significant findings from HMRC and provide my expert opinion of what this could mean for UK property moving forward.
In contrast, the non-seasonally adjusted estimate for June 2024 indicates 90,420 residential transactions, which is 5% lower than June 2023 and 2% lower than May 2024. Quite a difference, right? That is why you must take all of these figures with a somewhat sceptical outlook. These figures highlight the importance of considering seasonal adjustments when evaluating market trends, as they offer a more accurate representation of the market’s performance. If you are thinking of buying or selling property, don’t just take things at face value. Speak to a property expert, and consider the different factors.
When examining non-residential transactions, the seasonally adjusted estimate for June 2024 is 9,710, showing a 2% decrease compared to June 2023 and a 3% decrease from May 2024. Similarly, the non-seasonally adjusted estimate reveals 9,220 transactions, marking a 12% decline from June 2023 and a 9% drop from May 2024. These trends highlight a more subdued performance in the non-residential sector.
What Is UK Stamp Duty?
Stamp Duty Land Tax (SDLT) is a tax levied on property purchases in the UK. It applies to both residential and commercial properties. The tax is calculated based on the purchase price of the property and is paid by the buyer. The primary purpose of stamp duty is to generate revenue for the government, which can be used for various public services. That is basically it in a nutshell. Use our handy stamp duty calculator to work out how much stamp duty you could pay.
UK Stamp Duty Transactions Have Increased
The second quarter of 2024 has been particularly notable for the property market, with total Stamp Duty Land Tax (SDLT) transactions from April to June increasing by 15% compared to the previous quarter and 9% higher than Q2 2023. Residential property transactions in Q2 2024 saw a significant rise of 16% from the previous quarter and a 9% increase from Q2 2023, showing a robust and growing interest in residential properties. Non-residential property transactions in Q2 2024 also showed positive growth, with a 9% increase compared to the previous quarter and a 5% rise from Q2 2023. This indicates a balanced and healthy demand across different segments of the property market.
The financial health of the market is further reflected in the total SDLT receipts for Q2 2024, which were 22% higher than in the previous quarter and 9% higher than Q2 2023. Residential property receipts rose by 25% from the previous quarter and 8% from Q2 2023, while non-residential property receipts saw a 15% increase from the previous quarter and a 12% rise from Q2 2023.
First Time Buyer Stamp Duty Relief
First-time buyer relief claims have surged, increasing by 26% between Q1 2024 and Q2 2024, with 31,700 claims compared to 25,100 in Q1. Compared to Q2 2023, this represents a 25% increase, reflecting the government’s efforts to support first-time buyers and make homeownership more accessible. A total of £150 million was relieved in Q2 2024, marking a 26% increase from Q1 2024 and a 25% rise from Q2 2023.
Additionally, 48,700 transactions were liable to Higher Rates on Additional Dwellings (HRAD) in Q2 2024, generating £432 million in receipts (net of refunds). This is a 26% increase from the previous quarter and a marginal increase compared to Q2 2023. The percentage of residential receipts from HRAD transactions increased by one percentage point from 48% in Q1 2024 to 49% in Q2 2024.
The 2% surcharge on the purchase of residential properties by non-residents was applied in 4,800 transactions in Q2 2024, a 12% increase from the 4,300 transactions in Q1 2024. This surcharge generated £51 million (net of refunds) in Q2 2024, compared to £38 million in Q1 2024, representing a significant 34% increase.
Speak To A Property Expert Today
In conclusion, the UK residential property market continues to show resilience and growth, with strong transaction volumes and increasing financial receipts. As we move forward, these positive trends indicate a healthy market environment for homebuyers, investors, and industry stakeholders alike. With my expertise and experience, I am confident that the UK property market will continue to thrive and offer valuable opportunities for all involved. If you or anyone else you know is interested in purchasing a property in 2024 or 2025 as a first time buyer or experienced property owner, give our team a call today. We are more than happy to help.
