Official data showed that the number of transactions completed in September on a seasonally adjusted basis was also 1% higher than the previous month.
HMRC said this was a sustained recovery since the fall in transactions in April, after the stamp duty change.
On a non-seasonally adjusted basis, there were 102,420 residential property transactions in September, 8% up on last year and 2% lower than August.
Some buyers pause, some buyers press on
Industry figures suggested that the small increase in transactions was a sign of a split in the housing market, as some buyers waited for announcements to be made in the Autumn Budget and others continued with purchases.
Industry, not regulation, must lead later life lending change
Sponsored by Suffolk Building Society Intermediaries
Tom Bill, head of UK residential research at Knight Frank, said: “Housing market activity has been flat in recent months, with demand supported by stable and broadly affordable mortgage rates. However, a two-speed market has developed as the Budget approaches, with buyers and sellers in higher-value markets hesitating due to uncertainty around property taxes.
“The risk is that momentum is gradually sapped from the wider market after 26 November as sentiment weakens and the tax landscape deteriorates.”
Ian Futcher, financial planner at Quilter, said there was “hardly a boom” in the housing market, but it had “rediscovered a steady rhythm after a year of volatility”.
He added: “Despite the political noise and speculation around what the Chancellor might announce next month, many buyers are still getting on with it. The market seems to have accepted that higher borrowing costs are here to stay, and that stability, rather than cheap credit, is the new foundation for confidence.
“There’s still a sense of caution under the surface, with some sellers holding back until the dust settles after the Budget, but the underlying story is relatively positive. As the year draws to a close, the housing market looks less like it’s bracing for a storm and more like it’s learning to live with the weather.”
Richard Pike, chief sales and marketing officer at Phoebus Software, said the market was “resilient” despite uncertainty in the wider community. He added that the annual rise in transactions reflected the improved rate environment.
Pike added: “With inflation still stubbornly high, a rate cut looks unlikely next month, and so all eyes are on Rachel Reeves and whether she will make reforms to property taxes in the November Budget. This could have a significant impact on transaction activity if stamp duty changes are made. In the meantime, I expect next month’s transaction data to reflect the current uncertainty in the market, with many people adopting a ‘wait-and-see’ approach.”
