29 August 2025
"July’s housing market data shows modest but consistent improvement. Seasonally adjusted residential transactions reached 95,580, which is 1% higher than June and 4% above the same month last year. On a non-seasonally adjusted basis, activity was even stronger, with 101,070 transactions recorded. This represents a 5% increase month-on-month and a 4% rise year-on-year, suggesting that buyer demand remains resilient despite affordability challenges.
Since the sharp drop in April, the market has shown signs of stabilisation. However, volumes remain below the levels typically seen pre-Covid. Improved mortgage affordability and a more stable interest rate environment are helping to support confidence, although many households continue to face significant financial constraints.
Looking ahead, uncertainty around potential tax reforms in the upcoming Budget, including speculation about a mansion tax and changes to stamp duty, could prompt some buyers and sellers to sit on their hands. If these proposals are introduced, higher-value transactions may be particularly affected, potentially slowing activity for the whole market. For now, July’s figures point to a market that is stabilising, but future momentum will depend as much on policy developments as on economic fundamentals. If interest rates come down and property tax is not tweaked we may see activity rebound. However, transactions could grind to a halt if changes in the Budget spook prospective sellers.
