Property sales hit a new record of 213,120 in June (not seasonally adjusted), more than double the number in May.
This is the biggest month for sales since they were first measured like this in 2005.
June is always a popular month for the market, but this huge surge is largely due to people racing to beat the stamp duty holiday deadline at the end of last month.
Sales were higher than back in March, the original deadline, when there were 174,060 sales.
Sarah Coles, personal finance analyst, Hargreaves Lansdown: “The red-hot property market hit a blistering peak in June, as frenzied buyers raced to complete on their new home before the stamp duty holiday tapered at the end of the month. The question is whether the overheated market means buyers have been burned.
“June was the final month before stamp duty holiday was cut from making the first £500,000 of a property purchase tax free, to exempting the first £250,000. The holiday was originally due to end in March, and the extension wasn’t announced until just before the March Budget. This meant buyers hit the market in huge numbers, desperate for a quick deal. In June, twice as many property sales completed as is usual for this time of year.
“Unfortunately for these buyers, sellers didn’t hit the market in the same kind of numbers. There’s been a huge imbalance between buyers and sellers during the spring and early summer, which has meant panic buying, bidding wars, and the return of gazumping. Early figures from the commercial indices indicate this meant hefty price rises, with the Nationwide index showing the biggest annual surge in over 15 years.
“In this kind of frenzied market it’s easy to pay far more than the going rate. It’s also easy to feel you don’t have any other choice, so you end up pushing your budget and over-stretching your finances. Months down the line, you could seriously regret the lifestyle compromises you’ve had to make.
“When the market cools, buyer remorse tends to kick up a gear. The RICS survey in June showed agents expected sales to slow through the summer and into the autumn. Price rises are already showing signs of slowing, and there’s even the potential for them to take a step back if the economy is struggling with new variants when furlough is withdrawn.
“The good news is that even if you have overpaid and prices fall, if you’ve bought a home you love, you could afford, and you intend to live in for the long-term, then as long as you have a reasonable amount of equity, it doesn’t have to matter what happens to its theoretical price in the years you’re living there.
“However, if you have paid more than you can strictly afford, the sooner you address it the better. It’s well worth drawing up a budget to work out where you can cut costs in order to make higher mortgage payments, so you can keep on top of your finances and don’t end up being forced to sell at the worst possible time.”