After a slight dip in January 2021, the housing market showed signs of recovery in February. The number of sales surged to reach the highest levels on record, indicating that 2021 may be a very busy year for the industry. In fact, it has been suggested that this year, the market could see the highest number of sales since 2008.
Figures released at the end of March by HM Revenue & Customs revealed that the number of residential property sales in February 2021 reached 147,050. This number is up by 47% from the figures seen in February 2020 and the seasonally adjusted figure remains 23% above the already high levels that were seen in January 2021.
This rise in February followed the slight dip in sales seen in January, when levels fell by 2.4% according to HMRC data. Although the volume of sales remained comparatively high to previous years, January was the first month since lockdown restrictions eased in May 2020 that the number of sales dropped. Between May 2020 and January 2021, the housing market saw a continued upward trend.
It has been suggested that the surge was due to the initial deadline for the stamp duty holiday at the end of March. Although, this deadline has since been extended to the end of June for properties below £500,000 and the end of September for properties below £250,000. Only time will tell if market activity will dip following the announcement of the extension or whether there will be a repeat surge in activity when June arrives.
Some members of the industry, for example Tom Bill, head of UK residential research at Knight Frank, have suggested that the surge in sales completed in February in a rush to meet the initial deadline of the stamp duty holiday was ‘predictable’ and less surprising than the fact that the dip experienced in January was only as small as it was.
As always, there is no way to tell how long these levels of activity will continue and, as we have seen over the past year, predicting how the market will act in the next few months is a challenge to say the least. However, these figures emphasise how well the housing market has recovered from recent challenges and certainly encourages cautious optimism for the future.
House sales ‘highest on record’ in February | News | Housing Today
