The residential property market is performing slightly above 2024 levels, with a growth in demand in all UK regions except Northern Ireland and inner London, according to the latest Property & Homemover Report from TwentyCi.
The Q3 report from the property data and insight company shows a year-on-year improvement in both new instructions and sales agreed, with new instructions up by 1.7% and sales agreed rising by 3.2%. The increases take the totals for the year so far to 1.4 million new instructions (3.7% higher than 2024), with sales agreed 5.1% higher than in 2024.
Demand grew in all UK regions except Northern Ireland and inner London, which contracted year-on-year by 2.9% and 1.6% respectively. Growth was strongest in Wales, at 8.6%, with the East Midlands and North West both at 8%.
The decline in exchanges seen in Q2, driven by the rush to complete before stamp duty changes took effect, has now corrected to bring activity broadly in line with levels seen in Q3 2024.
‘The post-stamp duty slowdown appears to be over as activity (mortgage approvals) picked up over the summer’, said Alex Bannister, independent board adviser and former director of Future Ventures at Nationwide Building Society.
“However, the hangover from the spike in demand at the start of the year has led to a softening in house prices. There is also noise about the forthcoming budget and possible increases in property taxes. With interest rates held up by stubbornly high retail price inflation, the market is in a ‘watch and wait’ phase.”
The average time to exchange has increased by 1.7% since this time last year, taking the average number of days buyers are waiting to exchange to 123. Fall-through rates are also up, with a 0.5% increase taking the number for Q3 to over 82,000.
‘With 82,000 sales falling through in Q3 alone, we’re fully behind the government’s push to shake up the home buying process’, said Colin Bradshaw, TwentyCi CEO.
“Waiting four months just to exchange contracts is far too long, no wonder buyers get cold feet, or unexpected issues crop up in surveys.”
Chris Williams, founder of home buying and selling technology consultancy Novus Strategy, said the fall-through figures in TwentyCi’s report are a cause for alarm.
He commented:
“The big takeaway from this data, coming just days after the government announced major home buying reforms, has to be the sheer scale of the damage being inflicted on the property industry by fall-throughs.
“There have been 312,691 cancelled purchases in the last year according to TwentyEA/Ci, which is an absolutely eye-watering figure. Fall-throughs often occur due to the length of time it takes to complete a purchase, with changing circumstances, life events and long chains all exacerbating the problem. If we can reduce completion times and make the process more transparent, these numbers should fall sharply, as industry pilots have already demonstrated.”
As well as coming at a financial cost, fall-throughs create high levels of disruption that have a significant emotional impact, Williams added.
“Behind every cancellation will be a family that can’t move into a larger home, a couple unable to move in together or a pensioner struggling to downsize. Industry suffers too, from housebuilders and estate agents to mortgage brokers and lenders all shouldering the cost of wasted effort and investment.”
Williams welcomed the government’s planned reforms, which he said will inject some ‘much-needed momentum’ into the home buying process. ‘We’re already starting to see some of the green shoots of collaboration in industry that will deliver the transformation required, driven by organisations such as the Open Property Data Association’, he said.
“All the different players involved in transactions are investing now in getting this right and the rewards will be extreme. It’s easily possible that transaction levels will reach a new, permanently higher plateau that everybody will benefit from.”
According to TwentyCi, transactions are expected to reach 1.15 million in 2025 – however, the company warns the true figure will depend on the levels of public confidence surrounding the autumn budget on the 26th November.
‘A bit more upfront info at the start could really help smooth things out’, said Bradshaw.
“As we head into the final stretch of the year, we’re cautiously optimistic. If the autumn budget plays ball, we’re on track to hit 1.15 million completed transactions in 2025.”
Download the full Property & Homemover Report here.
