Wales has seen the biggest reduction in housing market activity in the UK in the aftermath of the Bank of England’s base rate hikes, according to research by the House Buyer Bureau.
Property sales have declined at an average rate of -3.4% per month across Britain since December 2021; there were 43,209 transactions in February 2023, down 45.2% compared with December 2021.
Sales volumes in January (44,635) and February were down 27.9% and 37%, respectively, compared with the same months in 2022.
In Wales, total monthly sales feel by 51.5%, with only 2,001 properties changing hands in February 2023, compared with 4,122 in December 2021.
Other areas that saw a strong decline included the East of England (-48.1%) and the East Midlands (-47.3%).
In London, transactions fell by an average of 3% per month since December 2021, following a similar trajectory to the rest of the country.
Scotland saw the smallest reduction, with 5,365 homes sold in February 2023, but this was still 39.9% lower than in December 2021, continuing an average 2.8% monthly decline in Scotland since interest rates started to increase.
Chris Hodgkinson, managing director of House Buyer Bureau, said: “The gloom is starting to set in across the UK, as higher mortgage rates serve to blunt people’s ambitions to buy.
“While some regions have fared worse than others, it’s clear that every corner of the market is feeling the effects of the current climate, as the perfect cocktail of high energy costs, high inflation and rising mortgage costs impacts affordability and confidence.
“In the current environment the only possible winners are cash buyers, because – faced with less competition from mortgaged homebuyers – they are in a good position to haggle for a favourable purchase price.
“For the rest of us, here’s hoping the Bank’s repeated base rate hikes fulfil their purpose and push inflation back near its 2% target. Until that happens it’s difficult to predict how high the base rate – and therefore mortgage rates – could climb.”
