Monthly property transactions July 22

ended 21. July 2022

HMRC is publishing the latest residential and commercial property transactions data at 09:30 this AM. Journalists mostly focus on residential but if you're in the commercial space, maybe add a few lines there, too. Answer any or all of the following Qs:

  • In your experience, has the number of residential property transactions (sales) risen, fallen or stayed the same in recent months, and why?
  • In your experience, has the number of commercial property transactions (sales) risen, fallen or stayed the same in recent months, and why?
  • Do you expect the number of residential property transactions to tail off or increase during H2, and why?
  • Do you expect the number of commercial property transactions to tail off or increase during H2, and why?

5 responses from the Newspage community

The number of residential transactions is likely to have risen as there will still be transactions that were meant to completed last year that did not get over the line in the previous year. For H2 I expect transactions to tail off slightly due to the lack of properties on the market for prospective buyers.
We've never been busier but it feels like that may be bucking the trend with fewer properties available, albeit with stock still way above pre-pandemic levels. I think it's certainly fiercely competitive so if you don't have a good broker getting you organised, and importantly providing the tools to show prospective estate agents that you're the best possible candidate to sell the house to, you risk missing out. That's why we provide all our clients with a 'passport to buy', and probably why they're as successful at winning the race to have an offer accepted.
As a business, we are adding close to £10m a week in committed gross loan volume across residential and commercial property purchases, so there is still a lot of life in the property market. Recently, we have seen interest in commercial properties increase, as interest rate rises on the residential side bring those rates up closer to that of commercial. Commercial property investors are targeting higher yields and generally safer revenue streams from high quality tenants with full repair and insurance leases. On the residential front, the cost of living crisis is creating a lot of uncertainty for property investors as having a tenant in situ guaranteed to be able to pay rent is less certain. I am also seeing more and more SIPP and SSAS Pensions holders investing in commercial property to create revenue streams both inside and outside their pensions. Within the residential investment space, we continue to see property sales increase among cash rich landlords taking advantage of market distress. I would expect prime residence sales to potentially level out with homeowners taking a breath and assessing the market before moving house in these turbulent and ever-changing economic times.
Looking forward, it's likely residential property transactions will decline until the broader economic picture starts to improve, and that doesn't look like it will happen anytime soon. The current level of inflation is likely to trigger a recession, which will clearly temper transaction levels. The residential property market is driven by sentiment and recessions hit sentiment hard. Commercial property transactions are a bit more volatile. This may be caused by companies trying to free up capital or reduce cash flow by downsizing. This is especially true following a move to more flexible working.
Residential property transactions remain high as demand for good-quality homes is still high. The pandemic forced many people to rethink their homes and lifestyles and for many the search for a new home is still going.