"It’s important to remember that transactions have remained static for some time now, and that the seasonal lull we typically see over the summer months is also likely to have played a role."
However the introduction of the 3% additional stamp duty tax caused a large increase in transactions for March followed by a "substantial reduction" in the following months.
HMRC added that "non-tax factors may have played a role as well, for example the Bank of England's plans to curb buy-to-let mortgages resulting in a rush to purchase before April 2016, and the EU Referendum affecting transactions in recent months".
For July 2016 the number of non-adjusted residential transactions was about 0.7% higher compared with June 2016. The number of non-adjusted residential transactions was 13.6% lower than in July 2015.
Stephen Smith, Director, Legal & General Housing Partnerships, commented: “Whilst there has been a slight fall in transactions this month, we shouldn’t jump to any conclusions and pin the blame entirely on the vote to Brexit. Though some buyers may have held off on purchasing a property ahead of the referendum, it’s important to remember that transactions have remained static for some time now, and that the seasonal lull we typically see over the summer months is also likely to have played a role.
Brian Murphy, Head of Lending for Mortgage Advice Bureau, added: “In reviewing the seasonally adjusted figures, whilst there is a slight drop month on month and year on year, it’s worth looking at the increase in July’s transactions on April and May. Another interesting point is that, taken individually, there was a slight increase month on month in transactions in England and Wales, with decreases in Scotland and Northern Ireland leading to the overall decrease in transactions since June.
“This would suggest that for those buyers and sellers who were ‘mid transaction’ at or after the time of the Referendum, the majority decided to continue with their sale or purchase, so although there were some ‘market jitters’, the data reflects that the majority of sentiment around the market remained positive in the weeks after the Brexit vote."
