House sales growth pauses for breath as stamp duty holiday winds down

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As of 1 July, buyers need to pay the levy again for purchases above £250,000 from £500,000 previously, meaning the maximum tax saving fell to £2,500 from £15,000

House sales have slowed down their frantic growth in England as the stamp duty holiday is phased out.

As of 1 July, buyers will need to pay the levy again for purchases above £250,000, down from the limit of £500,000 that had been in place since last July.

READ: Persimmon buoyed by surging house price inflation

On 1 October, rates will go back to normal with people paying the stamp duty from £125,000.

The first week of July, when the maximum tax saving fell to £2,500 from £15,000, “contained a few clues” on how the UK property market will look like towards the end of the year, estate agent Knight Frank said.

Exchanges at the agency in those seven days were just over 40% of the five-year average, while in the last week of June, exchanges were up 204% over the same period.

However, the number of new prospective buyers registering between 1 and 7 July was 31% above the five-year average for the same week, while the number of offers accepted increased by 59% and viewings rose 4%.

According to Knight Frank, international buyers could also show interest again in the third quarter of this year if travel restrictions continue easing, but they are facing a lack of supply.

“Stock is still low but building,” said James Cleland, head of Knight Frank’s Country business. “There will be a gradual restocking over July and August and good houses will sell well over the summer. It actually feels like we’re moving towards a better place as a rebalancing of the market is underway.”

Competitors  PLC () and  PLC () shed 3% to 74.35p and 2% to 56.6p respectively in the early afternoon.



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