Residential transactions in the UK totalled 85,820 last month, which is 20% lower than last year and 2% lower than November 2023
The number of UK residential property transactions dropped again in December while non-residential transactions rose, the latest HMRC Property Transaction report has found.
Residential transactions in the UK totalled 85,820 last month, which is 20% lower than last year and 2% lower than November 2023. This, as per HMRC, is the fourth successive month-on-month decline in residential transactions.
In contrast to the slowing residential market, non-residential transactions increased by 8% in December relative to the previous month and by less than 1% compared to the figures 12 months back.
The decline in property transactions last month demonstrates a seasonal lull, as can be expected during December, Ben Waugh, MD at later life lender more2life, commented on the HMRC report.
As we enter 2024, lowering rates will likely bring a flurry of buyers back to the market, and we can expect a rise in activity to start the year off well. The ongoing rates cuts and increasingly stable interest rates are a further sign that 2024 will turn a corner on the disruption of last year, he added.
For Tomer Aboody, director at property lender MT Finance, the lower transaction volumes are further proof that some government intervention is required in order to get the market moving.
While interest rates are stabilising, leading to lower mortgage pricing, stamp duty is still the biggest outlay for any buyer and therefore, also the biggest obstacle, he said. If there was to be some cut in stamp duty, this would incentivise sellers to finally move and increase the supply of properties coming to market.
Despite a slower pace in December because of the holiday season, the market, according to Clare Beardmore, director at Legal & General Mortgage Club, received an early gift in the form of a rates war.
Falling swap rates – which determine mortgage pricing – have encouraged healthier competition among lenders, leading to a drop in average mortgage rates for the fourth successive month in December, Beardmore said. The average mortgage rate now sits below 5%, helping to drive an increase in borrower enquiries.
Beardmore added: As we saw in Rightmove’s January data, there are green shoots in the housing market, with buyer demand up 12% against this time last year. We are slowly edging towards spring – typically the busiest season for the housing market.