Higher mortgage rates failed to dampen buyer motivation in April with housing transactions rising for the fourth month in a row and up year-on-year for the first time since November 2022, latest date from HMRC revealed last week.
Transactions rose 5% from 86,420 in March 2024 to 90,430 in April 2024 and seasonally adjusted were 10% higher than in April 2023.
Despite overall housing transactions in April being 10% below their five-year average Anthony Codling, RBC Capital Markets Managing Director Equity Research European Housebuilding, says: “Homebuyers and home movers appear to be leaning into the housing market headwinds and have their sights firmly set on sunnier times and the expectation of lower mortgage rates ahead.”
Jeremy LeafAnd Jeremy Leaf, north London estate agent and a former RICS Residential Chairman, says: “Transaction numbers, which of course include mortgaged and cash sales, always provide a much more comprehensive barometer of property market health than house prices.
“Despite reflecting activity of a few months ago, when there were heightened concerns about mortgage payments and inflation, considerable resilience has prevailed, which we are also seeing on the ground.
“In particular, the stronger employment picture means prospective homeowners are less concerned about the cost of mortgages than perhaps they were last year.”
MORE LISTINGS
Tom Bill, Knight FrankTom Bill, Head of UK Residential Research at Knight Frank, says: “Transaction volumes picked up thanks to more listings, particularly in the early weeks of the year when inflation forecasts were more optimistic.
“Sales were still 12% below their five-year average but should hold up this year despite the July election. We expect average UK prices to rise by 3% in 2024 as a rate cut moves onto the horizon this summer.”
And Matt Thompson, Head of Sales at Chestertons, adds: “The majority of buyers in April would have secured a fixed mortgage ahead of rate hikes which means they would have been largely unaffected by rising mortgage rates.”
Nick Leeming, Jackson-StopsNick Leeming, Chairman of Jackson-Stops, adds: “Certainty and stability in these figures help fuel consumer confidence, reflected in the 13% annual uptick of property listings that we’re seeing across our national network of branches, and 49% increase in new instructions in May alone.
“Whilst the starting pistol has been fired on the general election, lifestyle, schools and finances all remain significant levers for home movers in the immediate term.”
Nathan Emerson. PropertymarkHe adds: “Homeowners, renters, and property agents alike will be paying close attention to what the main parties have to say – and promise – in the coming weeks, and whether tax reforms may be on the cards. However, the biggest incentive may come from a future drop in interest rates to open more lending options for would-be buyers.”
Nathan Emerson, Chief Executive at Propertymark, says: “Year-on-year it’s extremely encouraging to see an increased confidence within the housing market.”
But he adds: “However, with a general election now only a matter of weeks away, there is the potential to see a summer slowdown, as people hold back to better understand what policies and support they may be promised by various political parties.”
