The UK housing market is showing signs of impressive stability ahead of the Autumn Budget despite speculation that the Chancellor may announce further support for homebuyers.
New analysis from London estate agent Benham and Reeves suggests that the property sector may not need a policy boost at all, with mortgage approvals, transactions and prices all demonstrating resilience despite elevated interest rates.
The latest Bank of England data shows 64,680 mortgages were approved in August – a level that has remained broadly consistent for the past 18 months, fluctuating between 61,000 and 68,000 approvals each month.
Although below the 100,000-plus seen during the pandemic’s stamp duty holiday, the figures indicate steady demand in the face of economic headwinds and a 4% base rate.
MARKET MOMENTUM
Sales activity has also shown notable recovery. HMRC data reveals that 149,940 property transactions were completed in March, the first time monthly completions have exceeded 100,000 since the pandemic boom.
Following a sharp correction to 43,980 in April, transactions have climbed steadily, reaching 87,360 in August – above the five-year average of 86,289.
This momentum has underpinned continued house price growth. The latest UK House Price Index shows the average property value has reached a record £295,670, underlining the market’s ability to maintain measured gains even in a higher borrowing environment.
The second home market, meanwhile, remains resilient despite government measures aimed at cooling investor demand.
STRONG FUNDAMENTALS
Provisional figures show 1,228 receipts from higher-rate additional dwelling transactions in the first quarter of 2025 — an 18% quarterly fall following last year’s Capital Gains Tax rise, but still the second-highest total since late 2022.
Marc von Grundherr (main picture), Director of Benham and Reeves, said the figures demonstrate “undeniably strong” fundamentals, adding that the market’s current steadiness is “far healthier for all involved” than the volatility seen in recent years. He cautioned that fiscal intervention should be measured, warning that poorly executed policies risk disrupting a market that is already performing robustly.
