UK

Housing transactions rise for the fourth month

Mortgage

Transactions increased 5% from 86,420 in March 2024 to 90,430 in April 2024 and seasonally adjusted were 10% higher than in April 2023

Higher mortgage rates failed to dampen buyer motivation in April with housing transactions increasing for the fourth consecutive month and up year-on-year for the first time since November 2022, latest data from HMRC revealed last week.

Transactions increased 5% from 86,420 in March 2024 to 90,430 in April 2024 and seasonally adjusted were 10% higher than in April 2023.

Despite overall housing transactions in April being 10% below their five-year average Anthony Codling, RBC Capital Markets MD Equity Research European Housebuilding, notes: Homebuyers and home movers seem to be leaning into the housing market headwinds and have their sights firmly set on sunnier times and the expectation of lower mortgage rates ahead.

Jeremy Leaf, a former RICS Residential Chairman, says: Transaction numbers, which of course include mortgaged and cash sales, always provide a much more comprehensive barometer of property market health than house prices.

Despite reflecting activity of a few months ago, when there were heightened concerns about mortgage payments and inflation, considerable resilience has prevailed, which we are also seeing on the ground, Leaf said.

In particular, the stronger employment picture means prospective homeowners are less concerned about the cost of mortgages than perhaps they were last year, Leaf added.

Tom Bill, Head of UK Residential Research at Knight Frank, adds: Transaction volumes picked up thanks to more listings, especially in the early weeks of the year when inflation forecasts were more optimistic.

Sales were still 12% below their five-year average but should hold up this year despite the July election. We expect average UK prices to increase by 3% in 2024 as a rate cut moves onto the horizon this summer, he added.

And Matt Thompson, Head of Sales at Chestertons, says: The majority of buyers in April would have secured a fixed mortgage ahead of rate hikes which means they would have been largely unaffected by increasing mortgage rates.

Nick Leeming, Chairman of Jackson-Stops, says: Certainty and stability in these figures help fuel consumer confidence, reflected in the 13% annual uptick of property listings that we are seeing across our national network of branches, and 49% rise in new instructions in May alone.

Disclaimer: The opinions expressed by our writers are their own and do not represent the views of Invest for Property. The information provided on Invest for Property is intended for informational purposes only. Invest for Property is not liable for any financial losses incurred. Conduct your own research by contacting financial experts before making any investment decisions.

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