New data from HM Revenue & Customs has revealed the number of UK residential property transactions in February 2024 was 3% lower than the same month in 2023.
The provisional non-seasonally adjusted estimate of the number of UK residential transactions in February 2024 is 73,360, 3% lower than February 2023 and 9% higher than January 2024.
Looking at the same data on a seasonally adjusted basis, HMRC said that transactions in February 2024 is 82,940, 6% lower than February 2023 and 1% higher than January 2024.
Commenting on the data, Andy Sommerville, Director at Search Acumen, the property data and insight provider, said:
“We are starting to see early green shoots of spring in today’s residential transaction figures, signs that the market is bouncing back from a difficult period constrained by affordability and supply last year. We can take some confidence in the gentle recovery of the market as potential movers are encouraged by falls in mortgage rates and a more stable macro-economic environment.
The commercial landscape has exhibited a degree more resilience compared to previous months, with non-residential transactions up 6% on last month, but down 3% annually. Whilst this modest uplift may inspire some confidence with investors, high borrowing costs continue to put a handbrake on larger commercial deals. Pockets of the market, such as Technology and Life Sciences, are prospering, partially in response to the Government’s ambitions to create the ‘Silicon Valley of the UK’ in the Golden Triangle. Our latest research found that commercial property values in Cambridge have climbed 44% over the last five years, despite a 20% fall in transaction volumes, demonstrating a hot market of high demand and limited supply.
In this challenging climate, demand must be capitalised on wherever possible, and every deal must be pushed forward unencumbered by delays. The property industry must urgently embrace technology and process innovation to maintain deal flow and support the overwhelmed Land Registry. Recent research shows that both homeowners and developers alike are experiencing delays of up to two years for registrations to complete in some cases. However, we can no longer afford to be slowed by antiquated paper-chasing and operational siloes. Fully digitising transactions across the value chain is key to injecting vitality and rekindling growth across sectors. With this in mind, we welcome the recent announcement this week from the Levelling Up Committee launching an inquiry on improving the home buying and selling process, identifying long term digitisation reform as a fundamental necessity for industry progress.
Without decisive action to enhance efficiency and affordability, the coming months risk a prolonged property limbo.”
Iain McKenzie, CEO of The Guild of Property Professionals, said that this month-on-month rise in home sales is “another piece of good news” that points to the “green shoots of recovery blossoming through the year”. He continued:
“Increased mortgage approvals and an expectation of lower interest rates to come all add to the sense that there’s a spring in the step of the property market. However, affordability still remains an obstacle for millions and we need to see more being done to address this for those eyeing up buying their own home
The Yorkshire Building Society announced a new product yesterday aimed at getting more first-time buyers on the property ladder, which is good news. The cost-of-living crisis has forced more people to shelve their saving habits, so any measures to help people with small deposits to buy should be welcomed.”
Nathan Emerson CEO Propertymark commented:
“Spring and summer are traditionally the strongest times for people to sell their homes, so we are likely to see a further uptake, making it easier to complete a transaction over the coming months .
Propertymark’s own Housing Insight Report more recently showed a 129% increase in the number of market appraisals undertaken, showing the growing desire from buyers and sellers to get moving once again.”
Karl Wilkinson, CEO at Access Financial Services said that while these figures are an “improvement on last month’s, reflecting the rickety uplift in the market” towards the end of last year, they are “still low compared to the year before”. He added:
“People are still feeling the squeeze. At 3.4%, inflation in the UK is quite a way off the 2% sweet spot and still higher than in the EU where it is 2.6%. While I appreciate caution, I hope that we don’t see the Bank of England continuing to delay a cut in the base rate. We need interest rates to go down soon to make mortgages more affordable, boost consumer confidence and drive sales.
A Spring Budget cut in stamp duty would have helped. Perhaps by Autumn we’ll have lower interest rates and an election-spurred stamp duty reduction, which would get people making property decisions with more confidence.”
Maria Harris, chair of the Open Property Data Association, said:
“February’s rise in residential transactions is an encouraging sign of recovery. It’s a busy time for the home-moving market, with rate changes and market updates coming at dizzying pace. Having a well-functioning home buying market has never been more important, so it’s encouraging to see the Levelling Up Select Committee inquiry on improving the process and the Law Society embracing upfront material information.
Currently, less than 1% of property data is available in an open, trustable, or shareable format. It’s essential that we fix these foundations and infrastructure through open data standards and trust frameworks before we can digitise the homebuying process and give consumers the transparency and ease of transaction they deserve.”
