The conveyancing sector has experienced a buoyant start to the year as solicitors rushed to complete transactions prior to higher stamp duty rates coming into force, latest research shows.
The government introduced a higher levy of three percentage points above current stamp duty land tax rates on 1 April.
Search Acumen’s conveyancing market tracker shows that 275,002 transactions were registered in the first three months of 2016, up 10% from the first three months of 2014, when 251,042 transactions were recorded in the run-up to the introduction of the Financial Conduct Authority’s pre-mortgage market review rules.
2014’s first-quarter results were the first time more than a quarter of a million transactions had been recorded in a single three-month period since the recession.
Search Acumen chair Mark Riddick said the ‘artificial stimulus’ of government intervention had put ‘major pressure’ on workloads.
Riddick expects to see a ‘residual effect’ in the second quarter of this year, ‘as some of the transactions logged by HM Revenue and Customs in March filter through Land Registry records as more applications are completed.’
The total number of firms active in the market rose by 2%, from 4,177 in the first quarter of 2015 to 4,278 this year. The top five conveyancing firms’ market share fell from 8% in the first three months of 2014 to 5% this year.
Riddick said ‘challenger’ firms further down the ranks had enjoyed the biggest benefits of a year-on-year rise in transactions.
He added: ‘A modest rise in the population of active firms has also occurred, with occasional players emerging to take some of the spoils and share the load.’
Looking ahead, Riddick predicted continued quarter-on-quarter growth in ‘first registrations’ as a result of a reported rise in the number of new dwellings in England and Wales.