Transactions surge in July



Property transactions jumped up by 7.2% in July, as people looked to buy before mortgage rates continued to rise, HMRC data shows.

There were 104,470 transactions in July on a seasonally adjusted basis, 36.7% more than the same month last year.

Anna Clare Harper, director of real estate technology platform IMMO, said: “The significant annual growth in transactions reflects the influence of policy and lockdowns, the last of which ended in July 2021. As a result, it is unsurprising that, with the benefit of temporary stamp duty relief for part of that period, and the absence of lockdowns, transactions have recovered in the last year.

“Going forward, the flow of ‘essential’ transactions, where a homeowner needs to move, are likely to continue. Non-essential transactions, for example where a property owner owns more than one property, or does not need to downsize, upsize or move, may slow down without the incentive of the temporary stamp duty reduction, and with higher mortgage finance costs due to interest rate rises.

“The trouble with this is that fewer transactions mean households have less flexibility. We are already seeing worsening shortages in rental housing force rents up, and the same is happening in the less flexible market for owned property, although the pace of house price growth is likely to slow.”

Typical 2-year fixed rate mortgages have now eclipsed the 4% mark for the first time since 2013.

Average two-year fixed mortgage surpasses 4%

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “On the ground, we are finding demand is still there but concerns about the rising cost of living and interest rates are prompting a more cautious approach which is reducing numbers and increasing the length and reducing the number of sales.

“On the plus side, sales agreed are maintaining their levels with buyers and sellers negotiating harder to ensure their move can get over the line.”

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