Property sales marching on

Property sales slowed annually during March but appear to have bounced back on a monthly basis, according to HMRC estimates.

It follows a two-month decline in sales between December 2022 and February 2023.

The latest property transaction data from the taxman shows the number of UK residential transactions in March 2023 on a non-seasonally adjusted basis was 94,870 - 14% lower than March 2022.

But this figure is 26% higher than February 2023.

On a seasonally-adjusted estimate, the number of UK residential transactions in March 2023 was 89,560, 19% lower than March 2022 and 1% higher than February 2023.

The seasonal figure suggests the quietist March on record for property sales going back to 2014.

Commenting on the data, Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “Although, of course, reflecting buying decisions made up to several months previously, transactions are always a better indicator of market health than more volatile house prices.

“The numbers confirm what we’ve been seeing on the ground for the past few months – buyers and sellers are emerging from a period of uncertainty and responding to increased supply of properties, as well as more stable interest rates. As a result, property market activity is proving to be much more resilient than we had feared, certainly at the end of last year.

“However, inflation and falling real incomes remain a concern, which is resulting in more hard bargaining and protracted sales.”

Tom Bill, head of UK residential research at Knight Frank, added: “The steep drop in property sales that followed the shock of the mini-Budget has bottomed out. The mortgage market has stabilised and buyers increasingly accept they are in a new lending landscape after 14 years of ultra-low rates.

“Buoyed by savings accumulated during the pandemic, record levels of housing equity and a strong jobs market, activity has been solid but not spectacular this year at all price points. The further we get from the mini-Budget, the stronger the market is performing.

“That said, homeowners will experience more financial pain as they roll off historical fixed-rate deals and UK prices should fall by a few percent this year. Properties that tick all the right boxes will hold their value but some of the pandemic froth has now disappeared.”

https://www.gov.uk/government/statistics/monthly-property-transactions-completed-in-the-uk-with-value-40000-or-above/uk-monthly-property-transactions-commentary