It found that there were 96,290 residential transactions, on a seasonally adjusted basis, a big jump on the previous month. However, this was down by 16.4 per cent on the same month in 2020.
The number of non-residential property transactions was also substantially up in the month. The HMRC data estimated that on a seasonally adjusted basis 10,840 non-residential deals took place, up by nine per cent on the previous month and 15.9 per cent on the same point last year.
HMRC noted that the increase came after a drop in October’s figures, which coincided with the end of the stamp duty holiday.
It is currently estimating that across 2021-22 there will be 939,750 residential property transactions, making it the busiest year in the last decade.
Still plenty of activity
Mark Harris, chief executive of mortgage broker SPF Private Clients, said that despite the increase in base rate in December, he expected to see transaction numbers continue to hold up even during what is usually a quieter month.
“The market is certainly less frenzied than it has been but there is still plenty going on,” he added.
“Mortgage rates remain low, despite the base rate rise, and are likely to do so into next year. Banks still have plenty of cash to lend and are keen to do so, which will help buyers realise their property dreams.”
Will house prices fall?
Karen Noye, mortgage expert at Quilter, noted that with lenders reacting to the base rate rise by increasing the cost of their deals, buying for first-time buyers has become all the tougher, particularly combined with rising house prices.
She continued: “While it may make buying a home more difficult in the short term, the interest rate rise could well serve to knock back the massively inflated housing market. As less people are keen to move and demand decreases, house prices may well fall – albeit probably at a slower pace than some may hope.”
Positive prospects for the commercial market
Gareth Lewis, commercial director of MT Finance, said that it was encouraging to see non-residential transactions peaking again, noting that the pandemic had caused these to dip due to so many people working from home.
He continued: “Provisional figures for this year show a good volume of non-residential transactions coming through. This may be partly down to speculation on permitted development and moving property into residential, or investors looking to diversify income streams because they see the benefit of owning a different type of stock.”