"2024 has the potential to be a positive year for buyers and sellers alike"
The UK witnessed a notable fluctuation in property transactions in January, with residential sales experiencing a decline compared to the previous year, according to the latest figures from HM Revenue and Customs (HMRC).
The provisional seasonally adjusted data indicates that the number of residential property transactions stood at 82,000, marking a 12% decrease from a year ago, albeit showing a slight 2% increase from month on month. Non-seasonally adjusted figures reveal a sharper decline, with transactions dropping to 68,090 – representing a 10% fall from January 2023 and a significant 20% decrease from the preceding month.
The non-residential sector displayed a different trend, with seasonally adjusted transactions totalling 9,790, slightly up by 1% from January 2023, with a marginal 1% dip from December 2023. The non-seasonally adjusted estimates for non-residential transactions recorded a 5% year-on-year increase to 8,750, despite a 17% reduction from the previous month.
“Property sales volumes continue to be held back by buyer affordability challenges, but cuts in interest rates this year could boost these numbers,” Nicky Stevenson, managing director at national estate agent group Fine & Country, commented on the HMRC report.
“The monthly uptick in sales on a seasonally adjusted basis is a positive sign, and the Bank of England has reported three consecutive monthly rises in mortgage approvals. This is one of the earliest indicators of future sales, and those numbers should feed into the transaction figures soon.
“First-time buyers are an important foundation for the property market, but they have been particularly hard hit by high interest rates. Competition in the mortgage market is bringing costs down, and interest rate cuts would reinvigorate this portion of buyers. Getting first-time buyers back on the march in significant numbers would increase transaction levels by making flats and smaller homes an easier sell.”
For Yasin Patel, co-founder of property investors Autarky Sukuk, the month-on-month uptick in transactions is a clear indication that there is momentum for growth in the property industry.
“As inflation creeps down and interest rate rises hold off, there is an increased appetite to buy, and more mortgages are being offered by lenders,” he said.
“2024 has the potential to be a positive year for buyers and sellers alike, but we need to see continued investments into building new homes that are both affordable and good quality. More efforts to ease the cost-of-living pressures facing first-time buyers will go a long way towards getting more people on the property ladder.”
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