The year-on-year increase follows a larger annual increase seen last month and reflects lower transaction levels in April and May 2025, when activity fell following changes to the stamp duty thresholds – which caused buyers to rush to complete before the end of March 2025 to secure a lower tax bill.
Andrew Lloyd, managing director of property data firm Search Acumen, said: “The latest decline indicates that falling market confidence is now translating into weaker deal flow. This is a negative signal for the economy, particularly as seasonal transaction levels at this time of year are typically more resilient. New political uncertainty tied to a new Prime Minister is also likely to weigh on near-term performance.
“Transaction volumes are below 100,000, showing that underlying market pressures are becoming more evident. We know transactions are taking longer to complete, so official figures often reflect conditions that have already changed, and this is a market deeply impacted by fast-changing economic sentiment. Affordability constraints, cost-of-living pressures, and higher mortgage rates are limiting growth.”
Lloyd warned that forward-looking indicators, such as Zoopla’s report finding that buyer demand has fallen by 15% and sales agreed are down 7%, along with the Bank of England’s depressed mortgage approval figures, point to further deterioration in the housing market’s performance.
There were 56,200 mortgages approved for house purchases in May, down from 66,000 in April and the lowest level seen since the end of 2023.
Episode 5: Larger Loans and Complex Lending: Powered by Partnership podcast from Newcastle for Intermediaries
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