Residential property transactions have continued to rise this year, while commercial property activity has declined, according to the latest analysis from Octane Capital.
The specialist lender’s research found that residential transactions are up 6.1% so far in 2025, compared with a 5.5% fall in non-residential transactions.
Octane Capital’s analysis of the latest UK property transaction data shows that non-residential deals are averaging 9,910 per month in 2025, down from 10,488 last year. In contrast, residential transactions are averaging 97,458 per month, up from 91,868 in 2024, marking the strongest activity levels since 2022. England has seen the largest rise, with a 7% increase in average monthly residential transactions, followed by Wales at 5.6%.
Jonathan Samuels, CEO of Octane Capital, said: “The commercial property market continues to face significant headwinds, with higher operational costs, subdued occupier demand across various sectors, and more stringent lending conditions collectively restricting investment activity.
“These pressures are contributing to a projected weakening of commercial transaction volumes throughout 2025. In stark contrast, the residential property market has shown a more resilient performance this year, with transaction levels trending upwards.
“This positive shift is largely attributable to an improvement in buyer sentiment, which has been buoyed by a general downward trend in mortgage rates.”
Samuels added that despite stronger residential activity, challenges remain. “While buyer sentiment has improved, ongoing economic uncertainties, stubborn levels of inflation and the potential for future interest rate adjustments mean that it is not an entirely smooth ascent.
In addition, growing uncertainty over the upcoming Autumn Budget is also playing its part and, as a result of these complexities, Octane Capital is observing consistent and robust demand for specialised financing solutions such as residential bridging and development finance.
The ability to access flexible and timely funding remains crucial for those seeking to navigate the evolving landscape and take advantage of the opportunities available in the residential market.”
