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Property transactions return to pre-Covid levels – ONS

  • 21/01/2022
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Property transactions return to pre-Covid levels – ONS
The number of residential property transactions completed in December totalled 113,470 when non-seasonally adjusted, lower than the level of transactions in 2020 but similar to levels seen before the pandemic.


Compared to December 2020, transactions were down 14.6 per cent on the 132,900 seen. However, compared to previous Decembers, 2021’s figure was in line with the 98,000 to 113,000 transactions recorded since 2013. 

Seasonally adjusted transactions were 20 per cent lower than last year at 100,110. 

On a monthly basis, transactions in December were 11.8 per cent higher than November when non-seasonally adjusted. Seasonally adjusted transactions were 7.6 per cent up on the previous month. 

December was the second month in a row that residential transactions in the UK rose following a sharp decline in October when the non-seasonally adjusted figure fell to 85,670 after the end of the stamp duty holiday. 

Joshua Elash, director of MT Finance, said the market was “gradually bouncing back from an October nadir”. 

“Transactional volumes now sit comfortably within the pre-Covid levels seen for the same period in 2018 and 2019, notwithstanding the general malaise in the greater economy.   

“Inflation is beginning to bite and it will find its way to the property sector. Transactional volumes in 2022 will continue to increase as more attractive yields make an overdue return, driven by rising property values and higher rents,” he said. 

Andrew Montlake, managing director of Coreco, added: “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.” 


Transactions at highest level since 2007 

In 2021, residential transactions reached their highest point since 2007 with seasonally adjusted transactions totalling 1,197,360. 

In 2007, this figure reached 1,473,950. 

Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “2021 was, without doubt, a rollercoaster year with peaks in activity caused by the staggered end of the stamp duty holiday, the easing of lockdown measures and the ‘race for space’ as homeowners re-assessed their housing needs due to the impact of the pandemic. Lenders and brokers pulled together to help support borrowers during those incredibly busy periods. 

“We’d expect 2022 to be a gentler ride for all involved, with a return to the more usual seasonal market activity. But there will still be plenty of opportunities for brokers, particularly within the first-time buyers and home movers sectors.” 


Lack of supply to fuel market activity 

Dominik Lipnicki, director of Your Mortgage Decisions, said: “The property market remained very strong in the closing stages of 2021. Demand remained healthy but the problem, as ever, was supply and that definitely limited transaction levels, even though they were up on November.  

“We expect to see modest growth in 2022 after a barnstorming 2021. This will further be impacted by soaring inflation, the cost of living crisis, energy price hikes and the planned National Insurance increase in April, not to mention further possible Bank of England base rate rises over the coming year.” 

Lee Griffiths, managing director at estate agents Saxon Paddock Estates and Homes, said the property market was “firing on all cylinders” during the second half of the year so it was no surprise that December transactions were up on the previous month.  

He added: “There would have been many more transactions were it not for the sheer lack of available housing stock. The shift to remote working and the ‘race for space’ continue to drive the market and even though inflation is at a 30-year high, demand, for now at least, remains very strong.” 

Lewis Shaw, founder of Shaw Financial Services, said: “As this data shows, the property market was still surging at the end of last year and the lack of stock means prices are unlikely to come off the boil during 2022. Yes, the cost of living crisis highlighted by Wednesday’s inflation data, tax hikes and possible squeezes to lenders’ affordability calculations may impact demand slightly, but those sitting waiting for a crash to pick up a bargain will be sorely disappointed.” 

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