This is according to the latest research by property development appraisal software, APRAO, which shows non-residential transaction levels dropped by just 5% year on year versus an 18% decline across the residential sector
While transaction levels have dropped over the last year, it is the non-residential market that has better weathered the storm caused by elevated borrowing costs and economic uncertainty.
This is according to the latest research by property development appraisal software, APRAO, which shows non-residential transaction levels dropped by just 5% year on year versus an 18% decline across the residential sector.
APRAO analysed the latest Gov data on quarterly property market transactions, looking at the split between the residential and non-residential sectors and how both have performed in what has been a challenging year for the UK market.
The evaluation shows that during the first quarter of 2024 around 255,570 transactions took place across the market as a whole, a quarterly decline of 13.1% and 7.4% fewer compared to the first quarter of last year.
In fact, it was the lowest quarterly total seen of any quarter since Q1 2022 following the first of 14 successive interest rate hikes in December 2021.
In terms of market split, residential transactions continue to account for the lion’s share of market activity, with 88.8% of transactions in the first quarter of 2024 coming through the residential sector. However, the 11.2% of market activity that did come via the non-residential sector was the highest proportion seen since the start of 2022.
When evaluating transaction trends within each market segment, the research by APRAO also shows that the drop in market activity seen during Q1 2024 has been far less pronounced within the non-residential sector.
Across the UK, residential transaction numbers dropped by 17.8% in the first quarter of 2024 versus the first quarter of 2023. Nevertheless, the drop seen across the non-residential sector stands at just 5%.
Residential sales were down by 18% or more across England (-18.7%) and Wales (-18%) during the first quarter of this year, whilst across the non-residential sector they dropped by just 4.7% and 3.7% respectively.
Just Scotland has seen a similar level of drop across both sectors, with residential transactions in the first quarter down 9.5% year on year, while non-residential sales dropped by 8.5% during the same period.
APRAO chief executive Daniel Norman said: Since interest rates started to climb in December 2021, we saw fourteen successive hikes which cultivated a great deal of market uncertainty, not to mention the ever growing obstacle presented by rising mortgage rates.
The post Non-residential market steady amid economic uncertainty first appeared on Invest for Property London, Buy Residential property UK.
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