The number of million pound home sales has declined to its lowest level since 2009 with the rise in stamp duty being blamed for the slowdown.
Research from Lloyds TSB claimed there were 3,043 million pound property sales in Great Britain in the first half of 2012 which is an 11% decrease on the same period in 2011. This decline was in contrast to the 3% market-wide rise in property sales over the same period.
Suren Thiru, Lloyds TSB housing economist, said: "The number of homes sold for over £1m has fallen significantly over the past year reversing the increases recorded over recent years. This partly reflects the changing market conditions for those looking to buy such properties including the 40% increase in the stamp duty rate for multi-million pound homes."
Sales of million pound homes account for a minor part of the national housing market representing just 1% of total sales in the first six months of 2012 and Lloyds estimated that only 166,000 homes fall into this category. Even in London million pound sales account for only 5.2% of all sales.
The decline in million pound sales in London, a 151 decrease (-7%) from 2,185 in the first half of 2011 to 2,034 in the same period this year, accounted for almost half of the national decline.
However the number of five million pound plus property sales continued to increase rising by 5% to 81 in the first six months of 2012 which was the third successive annual increase.
Thiru added: "However there does remain a certain amount of strength at the very top end of the housing market with sales of homes worth more than £5 million continuing to outstrip the rest of the market with the very top end of London property market still seen as a safe haven by investors."
David Sansome, Managing Director at Sansome & George said: “The Lloyds TSB report is probably factually correct across the UK as a whole but we must remember that the UK housing market is really a series of local and regional marketplaces. At Sansome & George we have seen no statistically significant change in the sale of £1 million pound plus homes in 2012 over 2011.
Anecdotally, with economic weaknesses and concerns in Europe there has been an increase in overseas buyer activity as people look for a “safe haven” for their property investment.”
