31 May 2023
If you are covering the UK monthly property transactions statistics, please see the following comment from Karen Noye mortgage expert at Quilter:
"The provisional seasonally adjusted estimate of the number of UK residential transactions in April 2023 shows there has been a huge 25% fall compared to the same month last year, and an 8% drop compared to March 2023. Residential transactions are now at their lowest level since October 2021
“While the economic path is starting to look a little more predictable and we had seen an uptick in transactions in March, April’s figures show a return to the buoyant market we had grown accustomed to is not yet on the cards.
“The spring and summer months typically bring more demand to the housing market but while inflation has finally started its descent, high mortgage rates could continue to put a dampener on transactions as moving home or taking the first step onto the property ladder becomes increasingly unaffordable. The Bank of England hiked its base rate to 4.5% in May and it is not expected to stop there. Lenders have continued to up their mortgage rates in response, and they are likely to increase further should the Bank hike rates again. However, with a decrease in demand, competition between lenders may keep any rises at a more reasonable pace than the highs witnessed at the end of last year.
“House prices have been slowly declining in recent months, reflecting the decreased level of demand, and we can expect them to continue falling steadily for a few months yet as sellers compete for buyers. For those still keen to move or buy their first home, where possible it may be worth considering a fixed-term deal for two years to make the most of lower predicted rates in 2025. If you are considering opting for a tracker mortgage to see you out of the current period of inflated rates, it is important to consider the potential for further BoE rate rises and the impact this would have on your monthly outgoings. Given the market is proving fairly unpredictable, it is important to seek professional advice to ensure you make the best choice for your personal financial circumstances.”
