Data from HMRC found that although there was a monthly drop in house sales, compared to last year this was 13% up.
On a non-seasonally adjusted basis, there were 104,440 residential property transactions during the month, 19% up on the same month a year ago and 6% down on the previous month.
HMRC said there was a rise in home sales in October, the same month as the Autumn Budget, but by November, this had returned to previous levels.
Affordability affecting home sales
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, said the dip in transaction volumes showed that “higher borrowing costs and affordability pressures are inevitably impacting buyer activity”.
She added: “That said, this month we have been seeing a good number of market appraisals, which is often a precursor to a strong spring market.
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“In areas where stock is limited, markets have remained steady, particularly the family home market with work-from-home potential. Homes that are well-priced and well-presented are still selling relatively quickly; while buyers may pause to assess financial implications, high-demand areas are likely to retain interest.”
Mark Harris, chief executive of SPF Private Clients, also pointed to the impact of mortgage pricing.
He said: “Swap rates have been mostly trending upwards since mid-December as the outlook suggests fewer rate cuts this year than previously thought. Despite this, a number of lenders including Halifax, HSBC and Leeds Building Society have made significant reductions to their fixed rates as they attempt to build a pipeline of business for the new year.
“However, other lenders have moved in the opposite direction and have raised some rates, including Skipton, Virgin and Clydesdale, while TSB has increased the pricing of more products than it has reduced, and Accord has increased as many rates as it has cut. Lenders who are increasing their pricing may be more sensitive to swap rate rises than bigger lenders who have more funds in savings to call upon and are better able to absorb any increases in swaps.”
However, Tomer Aboody, director of MT Finance, noted that the landscape was better than last year.
He added: “A quite significant increase in transaction numbers compared with this time last year shows how reduced interest rates have encouraged buyers and sellers to be active. Although we are still some way off the highs of previous years, the growing confidence in the market is promising.
“The full impact of the Budget has yet to be factored in, and therefore, a true indication of where we are at would be around the spring, once the stamp duty holiday comes to an end.
“Let’s hope a further cut in interest rates comes before then, helping the market stay productive and confident.”
This article was first published on YourMoney.com‘s sister site, Mortgage Solutions. Read: Property transactions slip in November – HMRC
