There was a dip in the number of properties bought and sold in August as buyers and sellers hold off on moving plans in the run up to the Budget.
In August there were 93,630 residential property transaction completed, which is 2% less than in July when sales had increased for the third month in a row.
Whilst the figures were higher than the number in August 2024, property professionals have noticed a reluctance from both would-be buyers and sellers to make a move at this time.
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, said: “The summer market proved to be surprisingly resilient given continued caution from buyers.
“In our offices, well-priced property continued to sell and the gap between serious buyers and committed sellers has narrowed.
“However, since then, buyers and sellers alike have become nervous about the pending Budget. The late November date is causing a slowdown in the market while people wait for clarity.
“It’s interesting that both sides feel they are better off waiting. There is still a market, the quality of applicants is good, and sales are being agreed.”
In August there was an interest rate cut but this followed a period in which mortgage lenders adjusted their prices upwards slightly. This also coincided with concerns over high inflation.
Holly Tomlinson, financial planner at Quilter, said today’s property figures highlighted the ‘fragile balance in the housing market’.
“After a run of monthly increases over the summer, activity cooled in August as higher borrowing costs continue to weigh on buyers,” she said.
“Inflation remains sticky and despite the expectation that the Bank of England will be able to reduce interest rates in due course, recent weeks have seen some mortgage rates edge higher again, tempering enthusiasm and affordability.”
She added: “That budget is now just weeks away and the swirl of rumours around stamp duty reform and potential mansion taxes only adds to the uncertainty.
“While any reforms are designed to raise revenue or support particular groups of buyers, the risk is that speculation alone prompts some households and investors to delay moving or restructuring their portfolios.
“Rather than providing clarity, these debates can glue up the market in the short term, with buyers and sellers waiting to see whether they will be better or worse off once the Chancellor sets out her plans.”
