"Encouraging inflation figures have led to lower Swap rates, which could mean cheaper mortgages in coming weeks, assuming no more negative data."
- Mark Harris, chief executive of mortgage broker SPF Private Clients
Seasonally adjusted residential transactions in February show a second consecutive month-on-month increase, rising 1% from 81,930 in January 2024 to 82,940 in February 2024, according to the latest HMRC statistics.
Non-seasonally adjusted residential transactions increased by 9% in February compared to January.
Year-on-year, seasonally adjusted residential transactions remain 6% lower than in February 2023 and non-seasonally adjusted transactions are down 3%.
Frances McDonald, director of research at Savills, commented: “Buyers are heading back to the market, thanks to an improved outlook which has boosted confidence. Completed housing transactions picked up (+1%) for the second consecutive month in February, even on a seasonally adjusted basis. But this data lags more recent housing market indicators.
“More up to date figures from TwentyCi show that greater confidence in the mortgage markets has fed into higher levels of activity so far this year. Agreed sales net of fall throughs in Q1 were 20% up compared to 2023 and remain 7% higher than pre-pandemic levels. The £300,000 to £500,000 price band saw the biggest uptick in activity (+25% vs last year) as more mortgage-dependent buyers have seen an improvement in costs.
“This also tallies with our March buyer and seller survey which showed a further pick up in prospective buyers’ commitment to move, particularly amongst those reliant on debt. It also showed early signs that buyers’ budgets are beginning to rise, especially those looking to upsize and take on more mortgage finance.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: "Transaction numbers have picked up as buyer and seller confidence improves on the back of cheaper mortgages and the hope that interest rates will start coming down.
“Encouraging inflation figures have led to lower Swap rates, which could mean cheaper mortgages in coming weeks, assuming no more negative data. Buyers are able to budget with more confidence and tend to be more willing to transact if they believe that interest rates have peaked and the cost of borrowing is going to come down.
“Lenders are demonstrating some welcome innovation in an effort to boost transactions, which are so important for the overall health of the housing market. Yorkshire Building Society’s 99 per cent mortgage is just one example of how lenders are looking for solutions to help first-time buyers, while still lending responsibly."
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, added: “On the ground, the sales market continues to gather momentum, as reflected in these numbers. An uplift in committed buyers and a strong pipeline of serious applicants bodes well for sellers who are coming to market now.
“With the housing market tending to slow down during an election year, now is an ideal time for vendors to capitalise on heightened demand, potentially resulting in faster sales and more favourable prices before the Prime Minister gets round to announcing the date. A range of buyers are out in force, from those with sizeable budgets seeking their forever home to first-time buyers and second-steppers looking for flats ideally with a bit of outside space.
“Overall market strength and stability is being underscored by better mortgage rates and an ongoing supply/demand imbalance.”
