UK residential property transactions declined in July on a seasonally adjusted basis as borrowing costs and economic uncertainty continued to temper activity.
The provisional seasonally adjusted estimate was 96,710 transactions, according to HM Revenue and Customs, down 2% from 98,390 in June and 1% compared with July 2025.
On a non-seasonally adjusted basis, residential transactions rose to 106,620, an increase of 3% from June and 5% year on year.
Seasonally adjusted non-residential transactions stood at 10,350, marginally higher than in June but 2% below July 2025. The non-seasonally adjusted estimate was 11,000, up 3% on the month and 1% on the year.
HMRC cautioned that the figures covered completed transactions, which typically take place two to four months after an offer is accepted, and did not necessarily reflect the present strength of the property market.
POLITICAL AND ECONOMIC UNCERTAINTY
Tomer Aboody, director of specialist lender MT Finance, said: “With a further change in Prime Minister, along with the prospect of more taxation on the way, the property market is reacting negatively with buyers and sellers reluctant to make a move.
“As opposition parties propose to cut stamp duty and some are even mooting the prospect of getting rid of it altogether, will the government respond by looking to do the same in order to get the market moving? It would definitely be a welcome step in the right direction.”
Melanie Spencer, growth director at Target Group, said: “While up on a non-seasonally adjusted basis, today’s dip shows just how sensitive the market remains to pressure, particularly with plenty of external noise and disruption in the wider economy. While there will be those undeterred by all the headlines and pushing on with plans, they remain the minority.
“In reality, higher borrowing costs and uncertainty around inflation, mortgage pricing and the wider economy has made households more cautious about committing to a purchase – despite good efforts from both lenders and brokers.
“It’s always important to remember these figures reflect decisions made weeks or even months ago. The bigger concern for the months ahead will be how current mortgage pricing and rate volatility, along with economic uncertainty and general borrower confidence feed through into new offers and mortgage applications.
“That forward-looking picture looks finely balanced and depends massively on factors outside the control of both lenders and potential borrowers.
“For lenders, this reinforces the value of being able to flex with the market. Whether volumes increase or soften, lenders need the technology, processes and people to manage changing levels of activity efficiently while maintaining a consistent customer experience and meeting the regulatory standards expected of them.”
AGENTS REPORT UNEVEN DEMAND
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, said: “There are noticeably low stock levels, which is creating a bit of competition over certain new instructions.
“There remains more supply than demand when it comes to smaller flats, although over the summer we have been agreeing more flat sales and have definitely felt there is more life in the market.
“We hope that the market continues to gather momentum and doesn’t prematurely slowdown in advance of the Budget – and of course that the Budget doesn’t further derail the property market but focuses on its recovery so that people feel free to move.”
Nathan Emerson, chief executive of Propertymark, said: “The latest figures suggest that the residential market is continuing to move in a positive direction, with more buyers and sellers progressing transactions. While this is encouraging, affordability remains a key consideration for households and could continue to influence the pace of activity.
“With transaction levels showing signs of resilience, maintaining consumer confidence and ensuring the home-moving process is as efficient and affordable as possible will be crucial to supporting the market in the months ahead.”
Jason Tebb, president of OnTheMarket, said: “The ongoing uncertainty created by the Middle East conflict and its impact on energy prices and interest rates continues to dampen activity.
“However, the market’s underlying resilience remains in evidence. Buyers and sellers who need to move regardless are adapting to changing circumstances and continuing to proceed.
“The Bank of England’s decision to hold interest rates this year, coupled with a number of lenders easing mortgage pricing in recent weeks, is helping with affordability at a time when the cost of living remans high.
“The slowdown in annual growth in average property prices suggests expectations are becoming more aligned with market conditions. If the stock coming to market in the autumn is priced appropriately from the outset, this should help transactions progress more quickly and smoothly.”
DATA LAGS BEHIND MARKET CONDITIONS
Richard Pike, sales and marketing director at Phoebus Software, said: “A fall in transaction numbers underlines just how cautious the housing market has remained through the spring and early summer.
“But these figures need to be treated in context. Transactions are a lagging indicator, largely reflecting decisions made several months ago, so a weaker July number isn’t necessarily a fresh signal about where the market stands today.
“With volumes having been broadly stable in recent months, the key question is whether this is a temporary dip or the beginning of a more sustained slowdown.
“The next few months will be more revealing, as the data begins to capture decisions made against the backdrop of more recent mortgage rate movements and continued economic uncertainty.”
