8:05 AM, 24th November 2022, About 2 weeks ago
The UK’s property market could see transactions slide by as much as 17% come spring of next year – and the downward trend could start next month as the market winds down for the Christmas period, one property purchasing specialist says.
According to House Buyer Bureau, it found that the level of transactions seen over the last six months is already down by nearly a quarter on the previous six months.
The firm says that’s because increasing mortgage costs have dampened buyer enthusiasm.
But with the property market already starting to freeze over, its latest research suggests that there are a tough few months ahead for the nation’s homesellers as the traditional market slowdown adds to a decline in market activity.
The firm has also analysed the average level of transactions seen over each month and a quarter of the year going back more than 10 years and how market activity is impacted by seasonality.
The research shows that at an average of 86,397 transactions, the final quarter of the year is the busiest for the UK property market, with the most transactions completing.
However, it tends to be the first quarter of the year that sees the lowest level of market activity.
Over the last 10 years, just 71,863 transactions on average were completed during Q1, marking a 17% drop on the final quarter of the previous year.
But when looking at the average number of transactions by month, the data suggests that the market slowdown looks set to kick in as soon as December.
On average, the level of transactions to complete in the month of December sits 2% below that seen in November.
This average level of monthly transactions continues to fall to an annual low of 63,974 in January, a further -26% monthly drop versus December.
The managing director of House Buyer Bureau, Chris Hodgkinson, said: “The property market has weathered a tough period in recent weeks, and we’ve already seen the damage done in the form of dwindling buyer demand and a resulting drop in transaction levels, as buyers struggle to overcome the increased cost of borrowing.
“Unfortunately, this decline in transactions is set to get quite a bit worse before it gets any better and the impending seasonal slowdown which usually kicks in from December will only add to the woes of the nation’s homesellers.”
He added: “The good news is that once this winter market freeze thaws in the spring, the nation’s buyers will emerge from hibernation, and we should see the market start to build momentum once again.
“Although this will do little to help those who are currently trying to sell and suffering from a reduced level of interest in their property.”
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