Property sales have been stable in recent months and are still higher than pre-Covid levels, according to HMRC.

For example, seasonally adjusted residential transactions stood at 99,200 in October 2019, while there were 100,580 the year before. 

Non-seasonally adjusted figures showed that residential transactions were 29% up on October last year, but 3% down on September. 

Although the figures point towards a steady property market despite the turbulence in the aftermath of the mini Budget, industry experts said transaction levels don’t reflect what is happening on the ground. 

First signs of a slowing market 

Lewis Shaw, founder of Riverside Mortgages, said the figures lagged behind economic reality. 

He said: “On the front line, it’s now a very different story. The phones have stopped ringing, buyers are holding off, and with the World Cup and Christmas upon us, most people have decided to sit tight and wait until next year.” 

Shaw said despite this, he did not believe house prices would drop by 10-15% due to waning demand but said asking prices could return to pre-Covid levels. 

Riz Malik, director of R3 Mortgages, said: “To quote Björk, the UK housing market is oh, so quiet and oh, so still. The sliver of activity we are seeing is coming from first-time buyers. With the World Cup, miserable weather and a month before everyone shuts down for Christmas, activity levels are likely to be pretty low.” 

This is echoed by Andrew Montlake, managing director of Coreco, who said: “First-time buyers are still active, and this key demographic is waiting in the wings ready to pounce as prices fall. The fact the mortgage market has now stabilised and that rates are not set to peak as high as we thought has brought some confidence back into the market, despite the predicted long recession that lies ahead.  

“After two years of surreal house price growth, some froth had to come off the market and that will drive transaction levels rather than destroy them.” 

Meanwhile Samantha Bickford, mortgage specialist at Mortgages with Clarity, said most of the conversations she’s having with clients is that they are going to hold off until the New Year to see what’s happening in the market.

“This is not unusual for this time of year, but is being heavily influenced by the hope that interest rates will start to come down again and mortgages will once again become affordable.  

“I am also seeing borrowers avoid using all of their deposit for their purchase, as they are nervous to part with their hard-earned savings by putting all their money into a new purchase, leaving them without an emergency fund. Rather than take on a higher mortgage amount, they are looking for a lower value property, or holding off all together for the time being,” she said 

Housing market proving its strength

Although some industry experts were noting uncertainty among buyers, others said the housing market had proved its strength in the face of economic uncertainty. 

Alex Smith, senior mortgage and protection adviser at Capricorn Financial Consultancy, said: “The robustness of the UK housing market remains.  

“Stamp duty cuts first introduced in September and more recently confirmed to remain in place until 2025 have already helped boost buyer confidence in what is an otherwise uncertain environment.” 

Mark Harris, chief executive of SPF Private Clients, added: “Transaction numbers are holding up as buyers with good mortgage offers are keen to complete before they expire. 

“There is good news for borrowers as swap rates continue their decline, resulting in several lenders repricing their fixed-rate mortgages. We now have five-year fixes starting with a four, rather than a six, and would expect them to go below four per cent by the spring as the cost of funds falls, servicing pressure subsides and lenders attempt to originate new business.”