Residential property transactions dropped 8% in April 2023 compared to the previous month, the latest HMRC figures have revealed.
Across the UK, there were 82,120 home sales in April, according to the provisional seasonally adjusted estimate. As well as being lower than the March total of 89,560 (which was a 1% increase on the previous month), it represents a 25% decline on the figure for April 2022.
According to HMRC’s non-seasonally adjusted estimate, meanwhile, there were 67,220 transactions in April, which was 29% lower than March and 32% down year-on-year.
The HMRC executive summary accompanying the figures noted that the fall in both seasonally adjusted and non-seasonally adjusted transactions appeared to be “particularly large”, adding that this was “partly due to the relative strength of March”.
The number of transactions in March was high due to “a combination of factors” including a larger number of working days relative to April and the final month for purchases to be completed under the government’s Help To Buy Equity Loan Scheme, the summary said.
Commenting on the latest figures, Chris Druce, senior research analyst at Knight Frank, said: “A fall in monthly property transactions, albeit after March’s performance was bolstered by the deadline for Help to Buy completions, provides a reality check for the health of the market.
“An improved economic outlook and solid jobs market has supported buyer sentiment in recent months and created an active spring sales market, after the mini-Budget knocked the sector off course last year.
“However, the cost of a mortgage is significantly higher than 18 months ago, and more pain will enter the system this year as people’s fixed-rate mortgage deals come up for renewal. With expectations of further rate rises ahead after last week’s inflation figures, and an increase in supply, we think property prices will fall by a few percent this year,” Druce added.
Simon Webb, from mortgage lender LiveMore, said: “Property transactions continue to fall following a month-on-month rise in March primarily due to more working days compared to February and April.
“The slowdown is likely to continue as uncertainty in the economy, along with the high cost of living and rising mortgage rates, will put some people off moving home. Until inflation comes down to more palatable levels and the base rate reduces, we expect 2023 to deliver a subdued housing market.”