House transactions 'almost halved'
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Posted: 23rd Jul 2008
Property transactions decreased by almost 50 per cent in June compared to 12 months ago, as homeowners have found it increasingly difficult to sell.
There were 77,000 property transactions last month, 14,000 less than in May, according to seasonally-adjusted Revenue and Customs figures.
House prices have dropped by nearly ten per cent since last August and Deutsche Bank chief UK economist, George Buckley, is concerned that this will have wider repercussions.
"This is a double-whammy. Not only will weaker transactions weigh on retail sales but there will be a big hit in terms of lost stamp duty revenues," he told Reuters.
Stamp duty is budgeted by the government to provide £13.5 billion in revenue this financial year, after raising over £14 million in the previous term.
However, if house values do not stabilise then stamp duty revenue could continue to drop by up to £5 billion, Gemma Tetlow from the Institute for Fiscal Studies believes.
"Lower house prices and falling transactions could have quite a considerable impact," she said.
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