Seasonally adjusted residential transactions in February showed a second consecutive month-on-month increase, rising by 1% from 81,930 in January to 82,940 in February, HMRC has revealed.
According to the data, non-seasonally adjusted residential transactions increased by 9% in February.
However, seasonally adjusted residential transactions remained 6% lower than in February 2023.
Seasonally adjusted non-residential transactions increased by 6%, marking only the second month since May 2023 in which transactions have increased or decreased by more than 1% month-on-month.
Non-seasonally adjusted non-residential transactions increased by 8% relative to January, while seasonally adjusted non-residential transactions were 4% higher than in February 2023.
Reaction:
Nathan Emerson, CEO Propertymark:
“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.”
Anna Clare Harper, CEO of GreenResi:
“Transactions are a helpful indicator of the health of the housing market.
“In February, there were 6% fewer transactions than this time last year on a seasonally-adjusted basis.
“This is a problem politically as housing transactions both affect and are affected by confidence, and low confidence is not good for voter sentiment.
“For this reason, many expect schemes to boost the housing market pre-election. This might come in the form of schemes for first-time buyers.
“Regardless of the form, if you are looking to get a good deal buying a house, the time is now – not in six months’ time when competition will be greater.”
Jeremy Leaf, North London estate agent and a former RICS residential chairman:
“These figures are interesting as unlike lender house-price indices they also include cash purchases, which make up around [40%] of total transactions, so are a good indicator as to what’s really happening in the market.
“However, because they reflect activity from the end of last year and beginning of 2024, they won’t fully reflect the influence of the more stable mortgage market we are seeing, partly prompted by falling inflation.
“Looking forward, we expect these mixed messages to continue for a few months at least as the market continues in recovery mode as it enters the crucial spring period.”
Amy Reynolds, head of sales at Antony Roberts:
“On the ground, the sales market continues to gather momentum, as reflected in these numbers.
“An uplift in committed buyers and a strong pipeline of serious applicants bodes well for sellers who are coming to market now.
“With the housing market tending to slow down during an election year, now is an ideal time for vendors to capitalise on heightened demand, potentially resulting in faster sales and more favourable prices before the Prime Minister gets round to announcing the date.
“A range of buyers are out in force, from those with sizeable budgets seeking their forever home to first-time buyers and second-steppers looking for flats ideally with a bit of outside space.
“Overall market strength and stability is being underscored by better mortgage rates and an ongoing supply/demand imbalance.”
Mark Harris, chief executive of SPF Private Clients:
“Transaction numbers have picked up as buyer and seller confidence improves on the back of cheaper mortgages and the hope that interest rates will start coming down.
“Encouraging inflation figures have led to lower Swap rates, which could mean cheaper mortgages in coming weeks, assuming no more negative data.
“Buyers are able to budget with more confidence and tend to be more willing to transact if they believe that interest rates have peaked and the cost of borrowing is going to come down.
“Lenders are demonstrating some welcome innovation in an effort to boost transactions, which are so important for the overall health of the housing market.
“Yorkshire Building Society’s 99 per cent mortgage is just one example of how lenders are looking for solutions to help first-time buyers, while still lending responsibly.”
Stuart Cheetham, CEO of MPowered Mortgages:
“The momentum is modest but unmistakable. After sliding throughout 2023, seasonally adjusted house sales climbed month-on-month in both January and February as the property market began the new year in recovery mode.
“There could be more good news to come too, with estate agents reporting an uptick in both the number of buyers and the number of homes coming onto the market.
“With the market becoming steadily more free-flowing, the tally of completed sales should pick up further in coming months.
“Two factors are driving the recovery – a widespread sense among buyers that last year’s drop in property prices is over and the improving affordability of mortgages.
“While the Bank of England chose not to reduce its Base Rate last week, it’s now a question of when, not if, the cost of borrowing comes down.
“The current consensus is that if inflation returns to the Bank’s 2% target quickly, it could make two or even three cuts to the Base Rate during the remainder of 2024.
“At MPowered we’ve already cut interest rates across our product range, with our fixed-rate mortgages coming down last week by up to 0.5%.
“As other lenders follow suit, falling interest rates won’t just ease the pain of the estimated 1.6 million homeowners whose existing fixed rate mortgages are due to end this year – they should also provide a much-needed boost to the property market and ensure the number of homes changing hands keeps heading in the right direction.”
