“These numbers interestingly demonstrate market strength and resilience even in the build-up to Christmas and withdrawal of government economic support in September.”
On a seasonally adjusted basis transactions totalled 100,110, 20.0% lower than December 2020 and 7.6% higher than November 2021.
Jeremy Leaf, north London estate agent and former RICS residential chairman, commented: “These numbers interestingly demonstrate market strength and resilience even in the build-up to Christmas and withdrawal of government economic support in September. Transactions are always a better measure of property market health than more volatile house prices.
“However, we have moved on since December. Activity and price rises are slowing a little, not least because of the continuing shortage of stock but concerns about rising inflation and mortgage rates is also compromising confidence when it comes to taking on debt.
“Looking forward, sales will pick up if homeowners can be persuaded to put their properties up for sale at perhaps more realistic levels, as there is no doubt that demand still strong.”
Andrew Montlake, managing director of Coreco, said: “Transactions in December 2020 were given a phenomenal boost by the stamp duty holiday, so it’s no surprise that transactions last month were down in comparison. The fact that transactions were up on November is a better reflection of where the market is at. Rock-bottom interest rates, a robust jobs market and the ongoing race for space gave the market rocket fuel last year. There are many red flags ahead in 2022, especially with rising interest rates and soaring inflation, but borrowing rates remain exceptionally low and that will support demand and transactions moving forward.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, added: “December’s strong transaction numbers, even though traditionally this tends to be a quieter month for the housing market, meant 2021 finished on a high. Much of that activity has carried on into January, with business brisk and borrowers keen to take advantage of cheap mortgage rates before they edge higher.
“Another interest rate rise could well come at the Bank’s meeting next month, given where Swap rates are and the pace at which inflation is running. Subsequently, we anticipate a slow, steady increase in the cost of mortgages, although it looks as though we will remain in an ultra-low interest rate cycle for the foreseeable future.”
Credit: Source link
